Answer-first summary for fast verification
Answer: An individual who depends on income from self-employment
**Correct Answer: C** **Explanation:** - **An endowment fund** typically has long-term investment horizons and stable spending needs, making it relatively well-positioned to bear business cycle risk. - **A high-net-worth individual** often has diversified income sources and substantial wealth, providing a buffer against economic downturns. - **An individual who depends on income from self-employment** is most vulnerable to business cycle risk because their income is directly tied to economic conditions. During recessions, self-employed individuals typically experience reduced income and business opportunities, making them least able to bear additional business cycle risk in their investments.
Author: LeetQuiz Editorial Team
Ultimate access to all questions.
No comments yet.
Which of the following investors would least likely have a comparative advantage in bearing business cycle risk in their equity investments?
A
An endowment fund
B
A high-net-worth individual
C
An individual who depends on income from self-employment