Economists define risk as
A)the difference between the interest rate borrowers pay and the interest rate lenders receive.
B)the degree of uncertainty of an asset's return.
C)the ease with which an asset can be exchanged for other assets or for goods and services.
D)the difference between the return on common stock and the return on corporate bonds.

Question

Quizplus · Accepted Answer

Economists define risk as the degree of uncertainty of an asset's return. This means that the higher the uncertainty of an asset's return, the higher the risk associated with holding that asset. Other factors such as liquidity and yield may also contribute to an asset's overall risk profile, but uncertainty of return is the primary factor.

Economists Define Risk as