The higher the rate of return for a given risk the
A) more attractive the investment.
B) less attractive the investment.
C) higher the cost of capital.
D) higher the hurdle rate.

Question

Quizplus · Accepted Answer

The higher the rate of return for a given risk, the more attractive the investment becomes. This is because investors are always looking to maximize their return while taking on an acceptable level of risk. A higher rate of return provides a better reward for the amount of risk taken on, making the investment more appealing.

The Higher the Rate of Return for a Given Risk