Question
John invested $1,000 in a risky investment and Bill invested $1,000 in a less risky investment. One year later, Bill's investment is worth $1,030. Which
John invested $1,000 in a risky investment and Bill invested $1,000 in a less risky investment. One year later, Bill's investment is worth $1,030. Which of the following statements is most correct?
Select one:
a. The worth of John's investment cannot be determined with the information given.
b. If John's investment is worth more than $1,030, then Bill was irrational to invest in the less risky investment.
c. John's investment must be worth more than $1,030 because of the risk-return tradeoff, given that John's investment was more risky.
d. If John's investment is worth less than $1,030, then John was irrational to invest in the risky project.
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