The concept of risk-return trade-off is best described by which of the following?
A) It is important only at the lowest management levels.
B) It relates to higher risk requiring greater return.
C) It will be more likely to influence the financial activities in an international company than a national one.
D) It will be more likely to influence the financial activities in a service provider than a manufacturer.

Question

Quizplus · Accepted Answer

The risk-return trade-off refers to the decision to accept higher risks in exchange for potentially higher returns. Therefore, option B correctly describes the concept. Option A is incorrect as risk-return trade-off is relevant at all levels of management. Option C and D are both incorrect as there is no inherent relationship between the concept of risk-return trade-off and whether a company is national or international or whether it is a service provider or a manufacturer.

The Concept of Risk-Return Trade-Off Is Best Described by Which