Return on Equity for a Very Risky Firm Should Be

question 32

True/False

Return on equity for a very risky firm should be higher than return on equity for a less risky firm.

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Definitions:

Trade Deficit

The circumstance where a country's imports outpace its exports, causing a negative trade balance.

Trade Surpluses

Trade surpluses occur when a country's exports exceed its imports over a given period, indicating a net inflow of domestic currency from foreign markets.

Savings Rate

The proportion of income that is saved rather than spent on goods and services.

Trade Deficit

Occurs when a country's imports exceed its exports during a given time period, leading to an outflow of domestic currency to foreign markets.