What Conclusion Should You Draw from the Performance of Stocks

question 53

Multiple Choice

What conclusion should you draw from the performance of stocks and bonds over the period 1926 to 2015?

• A)Bonds have greater volatility than stocks.
• B)Stock returns have a lower standard deviation than bond returns.
• C)In any year,stocks will outperform bonds.
• D)Stock returns have a smaller risk premium than bond returns.
• E)Stocks are riskier than bonds.

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Definitions:

Identity Versus Identity Confusion

Erikson’s fifth stage of psychosocial development, in which an adolescent seeks to develop a coherent sense of self, including the role she or he is to play in society. Also called identity versus role confusion.

Intimacy Versus Isolation

Erikson’s sixth stage of psychosocial development, in which young adults either form strong, long-lasting bonds with friends and romantic partners or face a possible sense of isolation and self-absorption.

Generativity Versus Stagnation

Erikson’s seventh stage of psychosocial development, in which the middle-aged adult develops a concern with establishing, guiding, and influencing the next generation or else experiences stagnation (a sense of inactivity or lifelessness).

Dependent Elders

Elderly individuals who rely on others for assistance with daily activities and personal care due to physical or mental limitations.