If an Investor Owns Between 20% and 50% of an Investee's

question 160

True/False

If an investor owns between 20% and 50% of an investee's common stock it is presumed that the investor has significant influence on the investee.

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Definitions:

Stock of the Economy

This term typically refers to the total value of all goods and resources available in an economy at a given point in time.

Nominal Rate of Interest

The interest rate unadjusted for inflation, representing the face value of interest payments.

Real Rate of Interest

The interest rate that has been adjusted to remove the effects of inflation to reflect the real cost of funds to the borrower and the real yield to the lender.

Holding-Period Return

The total return received from holding an asset or portfolio of assets over a period of time, typically expressed as a percentage.