Which One of the Following Statements Is FALSE

question 48

Multiple Choice

Which one of the following statements is FALSE?

• A)When we compute the return of a security based on the average payoff we expect to receive,we call it the expected return.
• B)The notion that investors prefer to have a safe income rather than a risky one of the same average amount is call risk aversion.
• C)Because investors are risk averse,the risk-free interest rate is not the right rate to use when converting risky cash flows across time.
• D)The more risk averse investors are,the higher the current price of a risky asset will be compared to a risk-free bond.

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Definitions:

Life Expectancy

The average number of years an individual or population is expected to live, based on statistical measures considering current death rates.

Infant Mortality Rate

The rate at which infants under one year of age die in a given population per 1,000 live births in a year.

Crude Birth Rate

The number of live births per 1,000 people in a population in a given year.

Teenage Pregnancy Rate

The number of pregnancies per 1,000 females aged 15-19 in a given year, a key indicator of reproductive health and socio-economic conditions.