Which of the following financial assets is likely to have the highest required rate of return based on risk?
A) Corporate bond
B) U.S. Treasury bill
C) Certificate of deposit
D) Common stock

Question

Quizplus · Accepted Answer

Common stock is likely to have the highest required rate of return based on risk because it is the most volatile and has the greatest potential for both high returns and significant losses. Corporate bonds, U.S. Treasury bills, and certificates of deposit are generally considered less risky and therefore have lower required rates of return.

Which of the Following Financial Assets Is Likely to Have