Refer to the graph. Consider an asset represented by point F. The process of arbitrage will draw investors to the higher rates of return,
A. increasing both price and the average expected rate of return.
B. changing the intercept of the Security Market Line until it intersects point F.
C. changing the slope of the Security Market Line until it intersects point F.
D. increasing the asset's price and lowering the average expected rate of return.
D. increasing the asset's price and lowering the average expected rate of return.
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Thomas Malthus's model assume that ___________
Fill in the blank(s) with the appropriate word(s).
Suppose a terrorist group bombs a federal building, causing $ 1 million in expenditures on new construction and healthcare for the victims. The new expenditures
A) would be subtracted from the gross domestic product account. B) would be added to the gross domestic product account. C) would be added to the gross domestic product account and subtracted from the national income account. D) would impact GDP in none of the above ways.
Figure 5-16
Figure 5-16 shows Adam’s purchases of bananas and apples when apples cost $5 each and bananas $4 each. The information implies that Adam’s income
A. must be $9. B. must be $20. C. must be $40. D. cannot be determined without further information.
Collateral is
A) the interest rate that banks charge high-quality borrowers. B) assets pledged to the bank in the event the borrower defaults. C) the difference between the value of a bank's assets and the value of a bank's liabilities. D) required reserves minus excess reserves.