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When Comparing T-Bills and Stocks,a Risk-Averse Investor May Choose to Invest

Question 35

Multiple Choice

When comparing T-bills and stocks,a risk-averse investor may choose to invest in T-bills although stocks give higher average returns because _____.


A) investing in stocks involves a long term commitment
B) investing in stocks involves a higher degree of risk
C) stocks are less liquid than T-bills
D) stocks cannot be bought and sold in a secondary market

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