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.

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Definitions:

Weight Of Elephant

The mass of an elephant, which can vary significantly based on species, age, and sex, generally ranging from 2,000 to 6,000 kilograms for adults.

Time To Answer

The duration taken by a respondent or system to respond to a query or request.

Continuous Random Variable

A variable that can take on an infinite number of values within a given range, often associated with measurements.

Speed

A scalar measure of the rate at which an object covers distance, typically expressed in units of distance over time.