In some situations,people must choose the amount of risk they wish to bear.A good example is investing in stocks or bonds.We will see that such investments involve tradeoffs between the monetary gain that one can expect and the riskiness of that gain.✓ In some situations, people must choose the amount of risk they wish to bear. A good example is investing in stocks or bonds. We will see that such investments involve tradeoffs between the monetary gain that one can expect and the riskiness of that gain