Concept of risk and return: finance quiz. There are a lot of things that people assess before they decide to invest in a project and this signifies an element of risk of making less money than intended. People take risk in different levels and it is believed that high risk projects bring more return. Do take up the quiz and get to see just how much you know about risk in projects and its relation to rate of return.
The growth in the value of an investment
The risk associated with an investment
Obtained only if the company pays dividends; without dividends, return is 0
The process of returning the stock to the corporation that issued it
Is always a year
Is always a month
Is always a quarter
Can be any length of time
Decrease
Increase
Have no effect on
Increase the risk of
The gain on the investment
The holding period
Risk
The amount of dividend
Risk aversion
Risk return tradeoff
Risk tolerance
Rate of return
A CEO is fired
A recession
A war
A presidential election
It is a measure of specific risk
It is a measure of market risk
It measures stock price levels for the entire market
It measures the level of dividends paid by various companies
It is designed to include companies for major industries
It represents large amount (25%) of the value of all stocks traded
Both a and b
Neither a nor b
20
30
100
500
Specific
Market
Both a and b
Neither a nor b
1
5
20
30
Specific
Market
Total
It doesn't - it measures return, not risk
Receiving dividends
Price growth
Both a and b
Neither a nor b
They think they will earn a large return on the investment
They have a high risk tolerance
Both a and b
Neither a nor b
Is generally thought to represent a more valid sample
Includes small stocks
Includes less stocks than the DOW
Includes only foreign company stocks
Stock A has a mean return of 7% and a standard deviation of 2%
Stock B has a mean return of 7% and a standard deviation of 10%
Stock C has a mean return of 12% and a standard deviation of 10%
Stock D has a mean return of 12% and a standard deviation of 20%
13%
5%
18%
8%