Arbitrage Occurs When

question 31

Multiple Choice

Arbitrage occurs when

• A)bond and stock rates of return equalize.
• B)investors try to profit from selling a lower rate of return asset to buy one that is nearly identical but with a higher rate of return.
• C)rates of return across all stocks equalize.
• D)investors move from lower to higher rate of return assets, regardless of the comparability of the assets.

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Definitions:

Bailee

A bailee is a person or entity that temporarily holds property or goods belonging to another, under a bailment agreement, with the duty to return them in good condition.

Transfer Control

The process of changing the ownership or authority over a particular entity or asset from one party to another.

Delivery

The process of transporting goods from one location to another or the act of transferring possession and ownership of an asset or property.

Automobile

An automobile is a wheeled vehicle powered by an internal combustion engine or electric motor, used for transportation of people or goods on roads.