Which of the following best completes the passage below?

The more worried investors are about losing their money, the more they will demand a high potential return on their investment; great risks must be offset by the chance of great rewards. This principle is the fundamental one in determining interest rates, and it is illustrated by the fact that __________.

Correct answer marked below

successful investors are distinguished by an ability to make very risky investments without worrying about their money

lenders receive higher interest rates on unsecured loans than on loans backed by collateral

Correct

in times of high inflation, the interest paid to depositors by banks can actually be below the rate of inflation

at any one time, a commercial bank will have a single rate of interest that it will expect all of its individual borrowers to pay

the potential return on investment in a new company is typically lower than the potential return on investment in a well-established company

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What this question tests

Whether you can complete the last sentence of an argument in a way that is logically consistent with it.

Choosing an option that sounds plausible but contradicts the argument or introduces new information.