What is the relationship between risk and return?

Business

1 answer:

PolarNik [594]3 years ago

8 0

Answer: A higher risk often means a higher return.

Explanation: Risk can be defined as the potential effect of an event, determined by combining the likelihood of the event occurring with the effect that it should occur.

Return can be defined as a gain or loss from an investment.

The relationship between risk and return is that the higher the risk, the higher the returns, however, a higher risk has a potential for loss. Hence, the word often in the statement "A higher risk often means a higher return."

A lower risk does not always mean a lower return, a lower risk has a potential for a higher return.

You might be interested in

Amanda's Interior Design has credit sales of $783,000, costs of goods sold of $418,000, and average accounts receivable of $107,

posledela

Answer:

The 50.30 days are required to take its credit customers to pay for their purchases.

Explanation:

For computing the average collection period, we have to use the formula of the average collection period.

Average collection period = Average accounts receivable ÷ Credit sales × total number of days in a year

= $107,900 ÷ $783,000 × 365

= 0.13780 × 365

= 50.30 days

We assume 365 days in a year

The cost of goods sold is irrelevant. Thus, it is not considered in the computation part.

Hence, 50.30 days are required to take its credit customers to pay for their purchases.

5 0

2 years ago

Suppose the monopolist is thinking about charging men a 10% higher price. if the monopolist does so, the quantity demanded by me

vovikov84 [41]

It would not fall at all. Monopolists own the entire industry meaning the consumers have no alternatives. If they have no alternative they have no choice but to buy even if the price increases

5 0

3 years ago

If your economics class were graded on a curve and everyone agrees to study only half as much, everyone would get the same grade

34kurt

STUDY!!!!!!!!!!!!!!!!!!!

6 0

2 years ago

When companies set their dividend payout, they generally aim for a rate that is?

Svet_ta [14]

The companies set their dividend payout, they generally aim for a rate that is when it is sustainable. The dividend payout ratio is the amount of dividends paid to stockholders relative to the amount of total net income of a company. The amount that is not paid out in dividends to stockholders is held by the company for growth. The amount that is kept by the company is called retained earnings.

8 0

2 years ago

Young children are permitted to work in the manufacturing of soccer balls in Pakistan, but this would not be legal in the United

e-lub [12.9K]

Answer:

no jodas

Explanation:

6 0

3 years ago