Which of the Following Statements Regarding an Investment's Risk Is

question 8

Multiple Choice

Which of the following statements regarding an investment's risk is not true?

• A) Investors measure risk to determine the degree of uncertainty surrounding their future returns.
• B) Risky stock will have a smaller range of returns and a smaller standard deviation of returns.
• C) Investments with a wide range of returns have more risk.
• D) Standard deviation measures the degree of volatility in the stock's return over time.

---

Definitions:

Bilateral

Bilateral refers to involving two parties, typically countries or individuals, especially in agreements, treaties, or transactions where both sides have reciprocal obligations or rights.

Promise

A commitment or assurance given by one party to another that they will do or not do something in the future.

Offeror

The party in a contractual agreement who proposes the terms of an offer to another party (the offeree).

Consideration

Consideration refers to something of value promised to another party in exchange for something else, forming a legal reason for parties to enter into a contract.