Aless-established company, or a company with a high debt to equity ratio, would be considered a riskier investment to the lender. which of the following principles attests to this axiom?
(a) direct relationship principle
(b) compensating balance concept
(c) risk/return trade-off
(d) cost-benefit analysis

(C) Risk/return trade-off

Explanation:

According to my research on company risk assessments, I can say that based on the information provided within the question the principle that attests to this axiom is Risk/Return trade-off. This is basically a trade off based on the more return sought, the more risk that must be undertaken

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