Which of the Following Statements Best Describes the Relationship Between

question 3

Multiple Choice

Which of the following statements best describes the relationship between risk and the average expected return of investments?

• A) Less risky assets will have similar average expected rates of return to more risky assets.
• B) Less risky assets will have higher average expected rates of return than more risky assets.
• C) More risky assets will have higher average expected rates of return than less risky assets.
• D) More risky assets will have lower average expected rates of return than less risky assets.

---

Definitions:

Intangible Assets

Non-physical assets having a value with an indefinite life span, such as patents, trademarks, and goodwill.

Amortized

Amortized refers to the gradual reduction of a debt over a period of time through regular payments that cover both the loan interest and the principal amount.

Natural Resources

Materials or substances occurring in nature which can be exploited for economic gain, such as minerals, forests, and water.

Metal Ores

Naturally occurring solid materials from which metals can be extracted profitably.