The Idea That Investors on Average Have Earned a Higher

question 74

Multiple Choice

The idea that investors on average have earned a higher return from common stocks than from Treasury bills supports the view that:

• A) investors are irrational.
• B) there is a relationship between risk and return.
• C) real rates of return will be lower during periods of price stability.
• D) stocks should be avoided when inflation is low.

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Definitions:

First Level

The initial or elementary stage in a series or categorization system.

Physical and Economic Survival

The requirement for basic necessities that sustain life and the financial means to secure these necessities.

Understanding Others

involves the ability to empathize and comprehend the thoughts, emotions, and behaviors of others, fostering better interpersonal relationships.

Sensitivity

The quality of being quick to detect or respond to slight changes, signals, or influences.