Risk averse investors will always invest in less risky assets,risk neutral investors will always invest...

Risk averse investors will always invest in less risky assets, risk neutral investors will always invest in risk-free assets, risk-taking investors will always invest in very risky assets.

a. True b. False

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Expert Solution

FALSE

Risk averse investors invest in assets with lower risk given the same level of return.

Risk-neutral investors do not consider risk into consideration when investing. They invest in assets that provide the highest return. They do not always invest in risk-free assets.

Risk-taking investors ignore the expected return and invest in assets with the highest risk.

jeff jeffy answered 2 years ago

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