Chapter2: The Domestic And International Financial Marketplace
Section: Chapter Questions
Problem 2P
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Question
Your friend told you that she invested $1,000 in a portfolio of large-company stocks 5 years ago and also reinvested the dividends. Her
investment grew to $3,456 as at today. Had she invested that same amount in a Government of Grenada bond she would have received $2,500
even if she reinvested the 10 percent coupons paid on the bonds.
REQUIRED
Why the price of many individual stocks still go down, even when the overall stock market goes up?
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