On average,for the period 1926 through 2011:
A) the real rate of return on U.S. Treasury bills has been negative.
B) small company stocks have underperformed large company stocks.
C) long-term government bonds have produced higher returns than long-term corporate bonds.
D) the risk premium on long-term corporate bonds has exceeded the risk premium on long-term government bonds.
E) the risk premium on large company stocks has exceeded the risk premium on small company stocks.

Question

Quizplus · Accepted Answer

The risk premium on long-term corporate bonds has generally exceeded that on long-term government bonds due to the higher risk associated with corporate bonds compared to government bonds.

On Average,for the Period 1926 Through 2011