Answered

An investor should expect to receive a risk premium for:

A. Lower consumer prices.
B. Expected lower inflation.
C. Reduced credit ratings.



Answer :

GinnyAnswer

Final answer:

Investors expect a risk premium to compensate for the borrower's riskiness in investments.


Explanation:

Risk premium compensates holders for risks inherent to an investment and is incorporated into the rate of return quoted for an investment. Investors expect a risk premium to account for the borrower's riskiness. For example, when comparing assets with similar coupon rates but different maturities, the asset with a longer time to maturity will have a higher yield due to the risk premium for time to maturity.


Learn more about Risk premium in investments here:

https://brainly.com/question/38008727


Other Questions