Compound interest refers to the multiple interest rates an investor will be paid

Question

Compound interest refers to the multiple interest rates an investor will be paid in a diversified portfolio True False The beta of an investment measures the probability weighted expected rate of rectum of a portfolio True False Lottery winners who take the lump sum payouts instead of payments spread out over many years believe the rate of return they could find In other financial assets is less than that implied in the extended sacrifice free money and are making an economically irrational decision prefers immediate to delayed returns are only making a rational economic decision if there is rapid inflation Payments to holders of corporate bonds are known as dividends True False Non - diversifiable risk is also known as idiosyncratic risk. True False The risk premium of a financial asset is the additional price the must be paid for riskier investments

Explanation / Answer

ans 4

false

because compunt interest is when interest is paid on interest

ans 5

false

because Beta measures the volatility or systematic risk of a portfolio

ans 6

c) prefer immmediate to delayed returns

ans 7

False

bond holders get interest and not dividend

ans 8

False

idosyncraatic risk can be avoided by diversification

ans 9

b) rate that compensates for risk

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