Which of the Following Statements Regarding Defensive Stocks Is True

question 49

Multiple Choice

Which of the following statements regarding defensive stocks is true?

• A) They are often expected to have above-average future growth.
• B) They often have high P/E multiples.
• C) They are expected to be adversely affected by high interest rates.
• D) They often produce necessary items such as food and prescription drugs.

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Definitions:

Preindustrial

Refers to societies or economies that exist before the development of industrialization, characterized by agricultural, handicraft, and manual labor-based systems.

Early Industrial

Referring to the period or stage of development where societies transition from agrarian to industrial economic activities.

Positive Checks

Mechanics that increase mortality rate and decrease population size, as per Thomas Malthus, including famine, war, and disease.

Thomas Malthus

An English economist and demographer known for his theory that population growth would outpace agricultural production, leading to widespread famine and hardship.