Short-term U.S. government securities are practically risk-free, and thus their rates of return are payments solely for
A) diversiﬁable risk.
B) time preference.
C) idiosyncratic risk.
D) pure proﬁt.

Question

Quizplus · Accepted Answer

The rates of return on short-term U.S. government securities are payments solely for time preference, as they are considered practically risk-free. The other options (diversifiable risk, idiosyncratic risk, pure profit) do not apply in this case.

Short-Term U