Refer to the graph. The risk premium for an asset with a beta equal to X would be:
A. Z
B. A plus B
C. Z minus B
D. Z minus A
C. Z minus B
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Consider a tax cut which affects not only consumer disposable income, but also after-tax earnings from labor supplied to labor markets and from financial assets acquired through saving. In the long run we would expect this tax cut to
A) increase both the price level and the level of real GDP. B) decrease both the price level and increase real GDP. C) increase the price level. D) increase the level of real GDP.
If a perfectly competitive firm is producing at a quantity at which MC < AVC, it cannot be maximizing profit in the short run
a. True b. False
How sensitive is the structural deficit to the state of the economy?
a. It is insensitive to the state of the economy. b. The structural deficit changes cyclically with the economy. c. Changes in the structural deficit trigger opposite swings in the economy. d. The structural deficit changes countercyclically with the economy.
Which of the following is an example of a firm's derived demand?
a. Workers with higher levels of education earn more, on average, than workers with lower levels of education. b. Factors that decrease the demand for labor will decrease the equilibrium wage. c. A tractor manufacturer's demand for assembly-line workers is inseparably linked to the supply of tractors. d. All of the above are correct.