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Which of the following statements about return are correct? I. In response to the same external force, the return on one investment may increase while
Which of the following statements about return are correct? I. In response to the same external force, the return on one investment may increase while the return on another investment may decrease. II. The return that fully compensates for the risk of an investment is called the risk premium. III. The required return on a risky investment includes a real rate of return, an inflation premium, and a risk premium. IV. If the required return on a stock is 5% and the risk-free rate is 2%, investors require a 7% risk premium on the stock. A. II and III only 5 B. I, II and IV only OC. I and III only O D. II, III and IV only
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