On average,for the period 1926 through 2005 in the US:
A)the real rate of return on U.S.Treasury bills has been negative.
B)small company shares have underperformed large company shares.
C)long-term government bonds have produced higher returns than long-term corporate bonds.
D)the risk premium on long-term corporate bonds has exceeded the risk premium on long-term government bonds.
E)the risk premium on large company shares has exceeded the risk premium on small company shares.

Question

Quizplus · Accepted Answer

Long-term corporate bonds typically have a higher risk premium than long-term government bonds due to the higher risk of default associated with corporate issuers compared to the government.

On Average,for the Period 1926 Through 2005 in the US