Elias is a risk-averse investor. David is a less risk-averse investor than Elias. Therefore,
A) for the same risk, David requires a higher rate of return than Elias.
B) for the same return, Elias tolerates higher risk than David.
C) for the same risk, Elias requires a lower rate of return than David.
D) for the same return, David tolerates higher risk than Elias.
E) Cannot be determined.

Question

Quizplus · Accepted Answer

A less risk-averse investor like David is willing to tolerate higher risk for the same return compared to a more risk-averse investor like Elias.

Elias Is a Risk-Averse Investor