Government bonds are essentially default risk-free,________ returns.

Question

Quizplus · Accepted Answer

Government bonds are considered default risk-free because they are backed by the full faith and credit of the government. However, because they are low-risk, they also have lower returns compared to other investments with higher risk. Choice C is the best answer as it correctly states that government bonds will have relatively low returns. Choices A and B are incorrect as they suggest high or highest yields, which is not accurate for government bonds. Choice D is incorrect as there is a correct answer.

Government Bonds Are Essentially Default Risk-Free,________ Returns