In making investment decisions, savers evaluate
A)the variability of the expected return as well as the size of the return.
B)the size of the expected return, but not the variability of the return.
C)the variability of the expected return, but not the size of the return.
D)neither the size nor the variability of the expected return.

Question

Quizplus · Accepted Answer

Savers evaluate both the size and variability of the expected return in making investment decisions. This is because savers not only want a high return on their investment, but they also want to minimize the risk or variability associated with that return. Therefore, option A is the correct choice.

In Making Investment Decisions, Savers Evaluate