If a Person's Required Return Does Not Change When Risk

question 179

Multiple Choice

If a person's required return does not change when risk increases, that person is said to be

• A) risk-seeking.
• B) risk-neutral.
• C) risk-averse.
• D) risk-aware.

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Definitions:

Inverse Correlation

A relationship between two variables in which they move in opposite directions; as one variable increases, the other decreases.

Independent Variable

A variable that is manipulated in an experiment to observe its effect on the dependent variable.

Dependent Variable

In scientific research, the outcome factor that researchers measure to examine the impact of variations in the independent variable.

Manipulation

The act of skillfully controlling or influencing others in an unfair or deceitful way.