Financial Accounting > EXAM > ACCTG 121 Multiple Choice Questions 7,8 (All)

ACCTG 121 Multiple Choice Questions 7,8

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ACCTG 121 Multiple Choice Questions 7,8 Multiple Choice Questions 1. If a person’s required return does not change when risk increases, that person is said to be (a) risk-seeking. (b) risk-indi ... fferent. (c) risk-averse. (d) risk-aware. Answer: B Level of Difficulty: 1 Learning Goal: 1 Topic: Fundamentals of Risk and Return 2. If a person’s required return decreases for an increase in risk, that person is said to be (a) risk-seeking. (b) risk-indifferent. (c) risk-averse. (d) risk-aware. Answer: A Level of Difficulty: 1 Learning Goal: 1 Topic: Fundamentals of Risk and Return3. _________ is the chance of loss or the variability of returns associated with a given asset. (a) Return (b) Value (c) Risk (d) Probability Answer: C Level of Difficulty: 1 Learning Goal: 1 Topic: Fundamentals of Risk and Return 4. The _________ of an asset is the change in value plus any cash distributions expressed as a percentage of the initial price or amount invested. (a) return (b) value (c) risk (d) probability Answer: A Level of Difficulty: 1 Learning Goal: 1 Topic: Fundamentals of Risk and Return 5. Risk aversion is the behavior exhibited by managers who require a greater than proportional _________ (a) increase in return, for a given decrease in risk. (b) increase in return, for a given increase in risk. (c) decrease in return, for a given increase in risk. (d) decrease in return, for a given decrease in risk. Answer: B Level of Difficulty: 1 Learning Goal: 1 Topic: Fundamentals of Risk and Return [Show More]

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