An Investor with High Risk Aversion Will Likely Require Which

question 61

Multiple Choice

An investor with high risk aversion will likely require which of the following risk return combinations?

• A) Expected return = 12%, Historical standard deviation = 17%
• B) Expected return = 14%, Historical standard deviation = 19%
• C) Expected return = 16%, Historical standard deviation = 21%
• D) Expected return = 18%, Historical standard deviation = 23%

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Definitions:

Bed-Wetting

The involuntary urination while asleep after the age at which staying dry at night can be reasonably expected.

REM Sleep

A phase of sleep characterized by rapid eye movement, increased brain activity, vivid dreaming, and temporary paralysis of major muscles.

Voluntary Muscles

Muscles that are under conscious control, allowing movements such as walking, grabbing, or speaking.

Brain Waves

Electrical patterns generated by the brain that can be measured and are indicative of different states of consciousness.