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1. In general, financial assets that have a(n). amount of risk have a rate of return.

1. In general, financial assets that have a(n). amount of risk have a rate of return.

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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. 1. In general, financial assets that have a(n) higher; higher lower; higher higher; lower equal; higher 2. The more liquid markets are the: lower the interest rates, and the lower the amount of investment. higher the interest rates, and the higher the amount of investment. lower the interest rates, and the higher the amount of investment. higher the interest rates, and the lower the amount of investment. 3. When purchasing a future contract, the buyer of a futures contract: • agrees to pay the seller later where the payment is based on the future price of some asset. assumes very little risk of the future price fluctuation of some asset. must pay a set amount to the seller regardless of what the future price turns out to be. none of these are true. 4. Those who believe that market prices always incorporate all available information believe: in the efficient-market hypothesis. • that randomly choosing a stock is not as effective as technical or fundamental analysis. that current stock prices do not represent true value as correctly as is possible. All of these are true. 5. The rate of return in loanable funds describes the: • the profit firms should make when investing borrowed funds. • interest rate on loans. . . . . . . . . . . . . amount of risk have a . rate of return. cost of borrowing. expected profit that a project will generate per dollar invested.
Transcribed Image Text:. 1. In general, financial assets that have a(n) higher; higher lower; higher higher; lower equal; higher 2. The more liquid markets are the: lower the interest rates, and the lower the amount of investment. higher the interest rates, and the higher the amount of investment. lower the interest rates, and the higher the amount of investment. higher the interest rates, and the lower the amount of investment. 3. When purchasing a future contract, the buyer of a futures contract: • agrees to pay the seller later where the payment is based on the future price of some asset. assumes very little risk of the future price fluctuation of some asset. must pay a set amount to the seller regardless of what the future price turns out to be. none of these are true. 4. Those who believe that market prices always incorporate all available information believe: in the efficient-market hypothesis. • that randomly choosing a stock is not as effective as technical or fundamental analysis. that current stock prices do not represent true value as correctly as is possible. All of these are true. 5. The rate of return in loanable funds describes the: • the profit firms should make when investing borrowed funds. • interest rate on loans. . . . . . . . . . . . . amount of risk have a . rate of return. cost of borrowing. expected profit that a project will generate per dollar invested.
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