In general, risk levels and average expected rates of return are
A) not related.
B) inversely related.
C) directly related.
D) as often inversely related as they are directly related.

Question

Quizplus · Accepted Answer

Generally, risk levels and average expected rates of return are directly related - the higher the risk, the higher the expected rate of return. This is because investors expect to be compensated for taking on additional risk.

In General, Risk Levels and Average Expected Rates of Return