Risk and Return MCQ Questions and Answers for Practice

Welcome to our Risk and Return MCQs section, where you can find a comprehensive set of multiple-choice questions to help you prepare for exams, interviews, and concept revision. Whether you're a student or a professional, these questions are designed to enhance your understanding of financial risk and return.

About Risk and Return MCQ Questions

Risk and Return MCQs cover essential concepts such as risk assessment, investment returns, and portfolio management. These questions delve into topics like standard deviation, beta, Sharpe ratio, and the Capital Asset Pricing Model (CAPM), providing a solid foundation in financial risk management.

Why Practice Risk and Return Objective Questions?

Practicing Risk and Return MCQs offers numerous benefits. It helps you prepare for school and college exams, competitive exams, and job interviews. Regular practice enhances your problem-solving skills, improves your understanding of financial theories, and boosts your confidence in handling real-world financial scenarios.

Who Should Use These MCQs?

  • Students preparing for school or college exams
  • Competitive exam aspirants
  • Candidates preparing for interviews

Risk and Return MCQ Questions for Practice

1. What is the definition of risk in finance?

2. In the Capital Market Line (CML), the slope represents:

3. Which of the following is an example of unsystematic risk?

4. The expected return of an asset is:

5. Which of the following is true about diversification?

6. The risk premium is:

7. Which of the following is NOT an assumption of the CAPM?

8. What is the main advantage of a well-diversified portfolio?

9. A stock with a beta of 1 means:

10. The Efficient Frontier represents:

11. The concept of "systematic risk" is:

12. What is the relationship between risk and return?

13. Which of the following is NOT a factor that affects systematic risk?

14. The Capital Asset Pricing Model (CAPM) assumes that investors are:

15. In the CAPM, the market portfolio consists of:

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