There Are Risks That Cause Uncertainty About the Return Over

question 16

Multiple Choice

There are risks that cause uncertainty about the return over some investment horizon. Which of the below is ONE of these risks?

• A) The uncertainty about the coupon payment at the end of the investment horizon if the bond does not default and has not been called or converted.
• B) The risk that the price of the bond will be higher than currently expected at the end of the investment horizon.
• C) One of these risks involves the uncertainty about the rate at which the proceeds from a bond that matures prior to the maturity date can be reinvested until the maturity date.
• D) This risk associated with reinvesting at a known rate of return.

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