CFA Practice Question

There are 294 practice questions for this study session.

CFA Practice Question

Investors' utility curves will be very ______ if they are very risk-averse, indicating they will not tolerate much additional risk to obtain additional returns.

A. steep
B. flat
C. curvilinear
D. curved
E. convex
Correct Answer: A

If investors are very risk-averse, their utility curves will be very steep, indicating they will not tolerate much additional risk to obtain additional returns.

User Contributed Comments 3

User Comment
zeiad their utility curves will be very steep
DonAnd Steep utility curve = conservative investor
Flat utility curve = less risk averse investor
kseeba17 Think of it in terms of elasticity
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