The ____ the Variance of Returns, Everything Else Remaining Constant

question 50

Multiple Choice

The ____ the variance of returns, everything else remaining constant, the ____ the dispersion of expectations and the ____ the risk.

• A) larger, greater, lower
• B) larger, smaller, higher
• C) larger, greater, higher
• D) smaller, greater, lower
• E) smaller, greater, greater

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Definitions:

Futures Contract

A standardized legal agreement to buy or sell something at a predetermined price at a specified time in the future, often used for hedging or speculating.

Obligation

A legal or moral duty to complete certain actions or to make payments to others.

Specified Price

Specified Price is the predefined price at which an investor agrees to buy or sell a security or commodity in a futures contract.

Municipal Bond Yields

The return investors can expect to earn if they hold a municipal bond until maturity, often tax-exempt.