Briefly describe the equity premium paradox of investments
What will be an ideal response?
Answer: In order to maximize gains, an investor should put his/her capital into the stock market which is relatively volatile but profitable. However, many investors choose to invest in low variability-low payoff investments like bonds. Research evidence suggests that loss aversion is why people avoid the more volatile stock market.
You might also like to view...
All of the following are problems observed to result from learning disorders EXCEPT a. Low employment
b. School drop-out. c. Drug abuse. d. Suicidal thoughts and attempted suicide.
Phencyclidine produces vivid visual hallucinations
a. True b. False Indicate whether the statement is true or false
Which of the following is the best example of conformity?
A. going shopping to buy the boots currently popular at your school B. wiping your feet so your roommate doesn't complain about the mud C. completing an assignment according to your professor's expectations D. following the posted rules at the pool by not running around the pool deck
A circadian rhythm is a biological fluctuation that occurs more than once a day
Indicate whether this statement is true or false.