Which of the Following Statements Is True

question 29

Multiple Choice

Which of the following statements is true?

• A) While finance teaches that investments with higher risk should have higher returns there is no historical evidence in the capital markets to suggest this relationship exists.
• B) Finance teaches that investments with higher risk should have higher returns and historical evidence in the capital markets suggests this relationship exists.
• C) When individuals decide how to invest their money they must weigh the expected benefits (returns)against the costs of additional risk.
• D) Both (a)and (c)are true.
• E) Both (b)and (c)are true.

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Definitions:

Segmentation Analysis

The process of dividing a market into distinct groups of buyers with different needs, characteristics, or behaviors.

Marketing Concept

A business philosophy suggesting that success is achieved by focusing on the needs and wants of target markets.

Response Time

The duration it takes for a system or service to react to a specific request.

Lifetime Value

The total net profit a company expects to earn from a customer over the duration of their relationship.