Which One of the Following Is a True Statement Regarding

question 92

Multiple Choice

Which one of the following is a true statement regarding the components of the risk factor?

• A)When choosing an investment,it is not necessary to consider the risk factor.
• B)During inflationary times,there is no risk that the financial return on an investment will not keep pace with the rate of inflation.
• C)The interest rate risk associated with corporate bonds is the result of changes in the interest rates in the economy.
• D)The risk of business failure deals with changes in the value of stocks and bonds due to changes in interest rates in the market.
• E)The prices of stocks,bonds,and other investments never fluctuate in the market.

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Definitions:

Standard Deviations

A statistical measure indicating the dispersion or spread of a set of numbers from their mean; it shows how much variation there is from the average.

Independent

Not influenced by or subject to another, capable of thinking or acting for oneself.

Standard Deviations

An estimator of the dispersion level or variability in a sequence of numbers.

Independent

A term indicating that two variables or events have no association and the occurrence of one does not affect the probability of occurrence of the other.