What is determined by comparing the risk of one asset to another?
A) Risk of time
B) Level of risk
C) Risk premium
D) Liquidity premium
E) None of the above

Question

Quizplus · Accepted Answer

Comparing the risk of one asset to another helps determine the level of risk of the asset. This allows investors to make informed decisions about which assets to invest in based on their own risk tolerance and investment goals. A higher level of risk may offer a higher potential reward, but also comes with a higher likelihood of losses.

What Is Determined by Comparing the Risk of One Asset