Which One of the Following Statements Is Correct

question 88

Multiple Choice

Which one of the following statements is correct?

• A)The greater the volatility of returns, the greater the risk premium.
• B)The lower the volatility of returns, the greater the risk premium.
• C)The lower the average return, the greater the risk premium.
• D)The risk premium is unrelated to the average rate of return.
• E)The risk premium is not affected by the volatility of returns.

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Definitions:

Corporate Governance

The framework of rules, practices, and processes by which a company is directed and controlled.

Ethical Failures

Incidents or behaviors that violate moral principles, often resulting in harm or disadvantage to individuals, groups, or organizations.

Scandals

Events or actions that cause public outrage or shock due to perceived ethical, legal, or moral infractions.

Discretionary Responsibility

The voluntary obligation or duty of an organization to contribute to the welfare of the broader community.