Chapter 8: Risk and Return Guided Reading Assignment 100 Points Learning Objective 1 What is the relationship between risk and return? How do risk preferences affect financial decisions? 1. What is risk in the context of financial decision making? The uncertainty or potential loss to amont ot a recasion 2. Define return and describe how to find the total rate of return on an investment. 3. Define the following risk preferences: a. Risk averse b. Risk neutral c. Risk seeking. 4. Which risk preference is most common among financial managers? 5. You buy a 10-year bond at par \\( (\\$ 1,000) \\) that pays \\( \\$ 30 \\) in interest once a year. You hold the bond for one year and collect the first coupon payment. By that time, the market's required return on the bond has risen from \\( 3 \\% \\) to \\( 4 \\% \\), so the bond's price is \\( \\$ 925.65 \\). What is your total return for the year? Learning Objective 2 How do we assess and measure the risk of a single asset? 6. Explain how a range of outcomes is used in scenario