Suppose a Stock Has the Same Expected Rate of Return

question 15

Multiple Choice

Suppose a stock has the same expected rate of return as a bank account. Then the price of the stock will

• A)rise and the expected rate of return will decrease.
• B)fall and the interest rate will decrease.
• C)rise and the expected rate of return will increase.
• D)fall and the expected rate of return will increase.
• E)fall and the expected rate of return will decrease.

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Definitions:

Conditioned Stimulus

A stimulus that initially has no effect but, after being paired with an unconditioned stimulus, eventually induces a conditioned response.

Classical Conditioning

An educational process that happens when a stimulus in the environment is associated with a stimulus that occurs naturally.

Love

An intricate mixture of feelings, actions, and convictions linked to intense sensations of love, protection, comfort, and esteem towards someone else.

Conditioned Response

An acquired reaction to a stimulus that was initially neutral, developed through its repeated association with a stimulus that naturally triggers a response.