Which of the Following Is the Best Example of Portfolio

question 56

Multiple Choice

Which of the following is the best example of portfolio investment?

• A)A U.S.company acquires less than 10 percent ownership of a foreign company.
• B)A U.S.company acquires more than 10 ownership of a foreign company.
• C)A foreign bank lends more than 10 percent of the funds needed by a business.
• D)A foreign bank lends less than 10 percent of the funds needed by a business.
• E)The Bank of America extends a loan to a foreign country.

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Definitions:

Output

The total amount of goods or services produced by a company, industry, or economy within a specific period.

Additional Unit

Referring to the next or extra unit of a product or service to be produced or consumed, often used in analyses of costs and benefits.

Perfectly Competitive

Describes a market situation where firms sell identical products, there are no barriers to entry or exit, and no single buyer or seller can influence the market price.

Excess Profits

Profits that exceed what is considered normal or expected, often due to favorable market conditions or monopoly power.