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      Question

      'Risk-Tolerance' is best described by which of the

      following?
      A It refers to the various types of risks one can take Correct Answer Incorrect Answer
      B It refers to the amount of risk one is willing to bear while investing Correct Answer Incorrect Answer
      C It refers to the passive instruments of risk-management Correct Answer Incorrect Answer
      D It refers to the period for which one is willing to risk his/her investments Correct Answer Incorrect Answer
      E It refers to the types of risks that can be reinsured by a third party Correct Answer Incorrect Answer

      Solution

      Risk-Tolerance is a risk management technique which involves the extent to which an investor is willing to endure more risk in exchange for the possibility of a higher return

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