One fundamental concept in financial economics is that an investment's rate of return is:
A. Positively related to the price paid for it
B. Inversely related to the price paid for it
C. Inversely related to the riskiness of the investment
D. Inversely related to the maturity of the investment
B. Inversely related to the price paid for it
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According to this Application, what is one of the major puzzles regarding international financial statistics?
A) There appears to be the same amount of investment income paid and received each year. B) There appears to be less investment income paid than received each year. C) There appears to be more investment income paid than received each year. D) none of the above
Juanita goes to the Hardware Emporium to buy a new circular saw. She is willing to pay $120 for a new saw, but buys one on sale for $85. Juanita's consumer surplus from the purchase is
A) $35. B) $85. C) $120. D) $205.
From 2000 to 2014, the dollar depreciated substantially against other currencies. This drop in value most likely benefitted
A) European citizens traveling in the U.S. B) U.S. citizens traveling in Europe. C) U.S. manufacturers importing parts from abroad. D) U.S. citizens purchasing foreign-made automobiles.
Situations of negative interest rates on short-term bonds resulted from:
A) high income tax rates B) government regulations requiring financial firms to purchase government bonds C) very low risk premiums D) investors were looking for safe havens when other investments were perceived to be very risky