The risk that funds may have to be reinvested at a lower rate in the future is the _______________. It is generally _____________ than the ___________________.
A)reinvestment risk, less, liquidity premium.
B)liquidity risk, less, reinvestment premium.
C)reinvestment risk, more, liquidity premium.
D)liquidity premium, more, reinvestment risk.

Question

Quizplus · Accepted Answer

Reinvestment risk is the risk that funds may have to be reinvested at a lower rate in the future. It is generally less than the liquidity premium, which is the premium paid for the ability to sell an asset quickly and easily.

The Risk That Funds May Have to Be Reinvested at a Lower