Q13

11. Suppose you pay $9500 for a S10,000 par Treasury bill maturing in effective annual rate of return (annualized holding period retur that you hold the bill until maturity? A. 2.07% B. 1.35% C. 2.89% D. 8.95% n)ro for this investment, assuming 12. Which of the following statements is/are true about a risk averse investor? A. A risk averse investor dislikes risk. B. A risk averse investor requires compensation in the form of a positive risk premium for bearing risk. C. A risk averse investor will not undertake high risk investments. D. A and B E. A and C 13 There are only two investment options available Option I has an expected return of 10% and a standard deviation of 1 5%. Option 2 has an expected return of 10% and a standard deviation of 40%, which option would be chosen by a risk loving investor? A. Option 1 B. Option 2 C. A risk loving investor would be indifferent between these options D. Not enough information is provided