Which ratio is based on the principle that a high-risk investment should generate higher financial returns for a business and more conservative decisions often generate lesser returns?
A) risk-return
B) price earnings
C) quick return
D) current

Question

Quizplus · Accepted Answer

The risk-return ratio is based on the principle that higher risk investments should generate higher financial returns for a business, while more conservative decisions often generate lesser returns. Therefore, this is the appropriate ratio to use in analyzing the relationship between risk and return. The other options (B, C, and D) are not directly related to this principle.

Which Ratio Is Based on the Principle That a High-Risk