Ben owns stock in two similar, large, financially sound corporations. Company A consistently earns rates of return of 12 percent per year, while company B regularly generates rates of return of 8 percent per year. If Ben is attempting to arbitrage, he
will:
A. sell his stock in company B and buy more stock in company A.
B. sell his stock in company A and buy more stock in company B.
C. keep his portfolio balanced with an equal or nearly equal number of shares of each stock.
D. buy stock in other companies in an effort to diversify and minimize risk.
A. sell his stock in company B and buy more stock in company A.
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Suppose the relationship between a person's age and his or her height is plotted with the age measured along the x-axis and the height measured along the y-axis. Then, the curve showing this relationship is
A) a straight line with a positive slope. B) positively sloped and becoming less stee
The aggregate demand curve illustrates that, as the price level rises
A) the quantity of real GDP demanded increases. B) the quantity of real GDP demanded decreases. C) the AD curve shifts rightward. D) the AD curve shifts leftward.
When drawn against current income, the slope of the Cd (r) + Id (r) + G curve is equal to the marginal
A) product of capital. B) product of labor. C) propensity to consume. D) propensity to save.
Which of the following is included in the M2 definition of the money supply?
A. Cash and currency B. Checkable deposits C. Money market deposit accounts D. Money market mutual funds E. All of these responses are correct.