__________ Are Inherently More Risky Than ___________

question 42

Multiple Choice

__________ are inherently more risky than ___________.

• A) Disruptive innovations; breakthrough innovations
• B) Incremental innovations; breakthrough innovations
• C) Breakthrough innovations; incremental innovation
• D) Functional innovations; process innovations

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Definitions:

Securities

Financial instruments that hold some type of monetary value, such as stocks, bonds, or options.

Factor Portfolios

Investment portfolios constructed to capture risk factors or sources of returns that are believed to explain the performance of securities.

Expected Return

The weighted average of all possible returns for a given investment, with weights being the probabilities of each outcome.

Risk-Free Rate

The hypothetical return rate on an investment that carries no risk of losing money, commonly illustrated by the interest rate on government securities.