The extra return that stocks earn over bonds (on average) compensates stockholders for a. the greater market
Question:
The extra return that stocks earn over bonds (on average) compensates stockholders for
a. the greater market risk that stockholding entails.
b. the greater firm-specific risk that stockholding entails.
c. the higher taxes levied on stockholders.
d. the higher brokerage costs incurred buying stocks.
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The correct answer is a the greater market risk that stockholding entails Heres why Market risk This refers to the possibility that the overall market ...View the full answer
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