The Rate of Return on Bonds Is Lower Than on Stocks

question 18

Multiple Choice

The rate of return on bonds is lower than on stocks over time because

• A) bond holders cannot diversify.
• B) bonds have a lower standard deviation in returns.
• C) stocks have less non-diversifiable risks than bonds.
• D) bonds are subject to more random risks than stocks.

---

Definitions:

Soft-Spoken

Characterized by a gentle, mild, or low vocal tone, often perceived as calming or polite.

Assertively

Communicating one's preferences, needs, and rights in a clear, honest, and respectful way without infringing on the rights of others.

Inconsistent Information

Information or data that does not align or correlate with other information, often leading to confusion or the need for further investigation.

Well-Established Impression

A firmly held belief or opinion about someone or something that is based on extensive experience or evidence.