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:

Interdependent Approach

A strategy or method that emphasizes the mutual reliance and cooperation among individuals or groups to achieve a common goal.

Self-Managed Teams

Groups of employees who are given the autonomy to plan, coordinate, and manage their own tasks and decisions within an organization.

Organization's Turnover

The rate at which employees leave a company and are replaced by new ones over a specific period.

Employee Attitudes

The overall feelings and opinions employees have about their workplace, which can influence their behavior and performance.