Question

Basic financial decisions and how do they involve risk return trade off

Answer 1

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Risk –return trade off: The financial decisions are interrelated and affect the risk and return of the firm. They have a combined effect on its market value.

Answer 2

Explanation:

Definition of 'Risk Return Trade Off'

This trade off which an investor faces between risk and return while considering investment decisions is called the risk return trade off. Description: For example, Rohan faces a risk return trade off while making his decision to invest.