Question 2 (1 point) The risk that the value of an investment could decline as a result of a change in interest rates. a liquidity risk b credit risk C interest rate risk

The correct answer is C, interest rate risk.<br /><br />Interest rate risk refers to the risk that the value of an investment could decline as a result of a change in interest rates. When interest rates rise, the value of existing investments with lower interest rates tends to decrease, as new investments will offer higher returns. Conversely, when interest rates fall, the value of existing investments with higher interest rates tends to increase.<br /><br />Liquidity risk (option a) refers to the risk that an investment may not be easily sold or converted into cash without a significant loss in value. Credit risk (option b) refers to the risk that an issuer of a security may default on its financial obligations, such as failing to make interest payments or repay principal.<br /><br />Therefore, the correct answer is C, interest rate risk.