Which of the following statements is correct?
A) Expected returns as estimated by a marginal investor are sometimes positive,but realized returns are always negative.
B) Expected returns as estimated by a marginal investor are always positive,but realized returns are sometimes negative.
C) Expected returns as estimated by a marginal investor are sometimes negative,but realized returns are always positive.
D) Expected returns as estimated by a marginal investor are always negative,but realized returns are sometimes positive.

Question

Quizplus · Accepted Answer

Expected returns as estimated by a marginal investor are based on their assessment of the investment's future performance, and are therefore generally positive. However, realized returns may deviate from expectations due to unforeseen market conditions or events, resulting in negative returns. Therefore, option B is the correct choice.

Which of the Following Statements Is Correct