You own a stock that you think will produce a return of 11 percent in a good economy and 3 percent in a poor economy. Given the probabilities of each state of the economy occurring, you anticipate that your stock will earn 6.5 percent next year. Which one of the following terms applies to this 6.5 percent?
A. arithmetic return
B. historical return
C. expected return
D. geometric return
E. required return
Ans: C. expected return
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The takeover process dissipates capital, making it an inefficient market mechanism.
Answer the following statement true (T) or false (F)
Macroeconomic variables that the Fed cannot control directly but can influence fairly predictably, and which are related to the Fed's goals, are known as
A) instruments. B) tools. C) intermediate targets. D) initial targets.
Which of the following best describes the difference between an objective concept and a subjective concept?
a. A subjective concept is a fact based on observation that is not subject to personal opinion, while an objective concept is based on personal preferences and value judgments. b. An objective concept is a fact based on observation that is not subject to personal opinion, while a subjective concept is based on personal preferences and value judgments. c. A subjective concept relates to issues in microeconomics, while an objective concept relates to issues in macroeconomics. d. An objective concept can only be illustrated in words, while a subjective concept can usually be illustrated with a graph.
How does the labor force participation rate of women compare to that of men in the United States?
A. The labor force participation rates between the two groups is about the same. B. Women participate less than men when young (20-34 years old) but at the same rate as men in later years (35-54 years old). C. Men participate less than women at all ages. D. Men participate less than women when young (20-34 years old) but at the same rate as women in later years (35-54 years old). E. Women participate less than men at all ages.