Investors demand a higher return for investments that have larger fluctuations in values because ________.
A) they do not like risk
B) they are risk seeking
C) they invest for the long term
D) they prefer fluctuations

Question

Quizplus · Accepted Answer

Investors typically demand a higher return for investments with larger fluctuations in value because they are averse to risk. The larger fluctuations represent higher risk, and investors need to be compensated for taking on that additional risk.

Investors Demand a Higher Return for Investments That Have Larger