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What is the relationship between risk and expected return?

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Please help answer the following questions. Provide at least 200 words in your solution.

1. What is the relationship between risk and expected return?

2. How much financial risk are you willing to take? By that I simply mean would you risk money on something with a potential high return when it also meant you might lose all the investment?

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Solution Summary

This solution explains the relationship between risk and expected return. It also explain how much financial risk one might be willing to take and whether they would risk money on something with a potential high return when it also meant you might lose all the investment. The explanation is given in 244 words.

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See below for the answers to your questions.

1. What is the relationship between risk and expected return?
** Risk is the chance that an eventuality will happen or not happen. On the other hand, expected return is the anticipation that an outcome will result or come into being. Therefore, the relationship is in the fact that within an ...

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