The Process of Simultaneously Buying and Selling the Same or Equivalent

question 48

Multiple Choice

The process of simultaneously buying and selling the same or equivalent securities in different markets to take advantage of price differences and make a profit is called ____.

• A) option pricing
• B) diversification
• C) arbitrage
• D) margining

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Definitions:

Money Supply

The overall pool of economic resources in terms of money available at a particular time in an economy, including coins, paper money, and deposits in savings and checking accounts.

Fed

Short for the Federal Reserve, which is the central banking system of the United States, responsible for monetary policy.

Required Reserve Ratio

The fraction of deposits that banks are required by law to keep on hand or with the central bank as a reserve.

M1 Money Supply

A category of money supply that includes all physical money like coins and currency, as well as demand deposits and other liquid assets held by the central bank.