Which of the following will tend to result in the least variation in the expected real rate of return from the ownership of stocks?
A) ownership of stocks from a specific sector (for example, the technology sector) over a lengthy period of time
B) ownership of a single stock over a lengthy period of time
C) ownership of a single stock for a short period of time
D) ownership of a diverse set of stocks (the Standard & Poor's 500, for example) over a lengthy period of time
D) ownership of a diverse set of stocks (the Standard & Poor's 500, for example) over a lengthy period of time
You might also like to view...
Is the CPI a biased measure of the inflation rate? Explain your answer
What will be an ideal response?
Suppose you are risk averse and you are deciding between two investments. One has a guaranteed return of 5% while the second has a 50% chance of a 10% return and a 50% chance of a 0% return. Which investment would you choose? Why?
What will be an ideal response?
Which of the following did not result in economic growth?
a. Installing a network of irrigation ditches and pumping stations in order to grow fruits and vegetables in parts of southern California b. Cyrus McCormack inventing a threshing machine for harvesting grains c. After World War II, the U.S. instituting the GI bill, which provided education subsidies to soldiers being released from service duty d. Many citizens emigrating from a nation when a politically repressive regime takes office
When the flow of money from the foreign countries to the domestic firms equals the flow of money from the home country to the foreign firms, _____
a. a trade surplus exists b. an equal amount of agricultural and manufactured products are exported c. a trade deficit exists d. an equal amount of goods and services are imported e. the value of net exports is zero