Question

Over the past ten years, large-company stocks have returned an average of 10.4 percent annually, long-term corporate bonds have earned 4.6 percent, and U.S. Treasury bills have returned 3.2 percent. How much additional risk premium would you have earned if you had invested in large-company stocks rather than long-term corporate bonds over those ten years?
A. 1.7 percent
B. 3.7 percent
C. 5.2 percent
D. 5.8 percent
E. 8.1 percent

Answer

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