A Firm Has 50 Computers

question 95

Multiple Choice

A firm has 50 computers.Every year,they buy 3 new ones and get rid of 3 old ones.In this case,investment is equal to ________ and net investment is equal to ________.

• A) 3; 3
• B) 3; 0
• C) 3; -3
• D) 6; 3
• E) 3; 6

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Definitions:

Portfolio Riskiness

Refers to the degree of uncertainty or potential financial loss inherent in an investment portfolio.

Beta

A measure of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole. It is used in the capital asset pricing model.

Randomly Selected Stocks

Randomly selected stocks are shares chosen without a specific criterion or pattern, used often in experimental portfolios or studies to simulate or analyze market behavior.

Expected Inflation

The anticipated rate at which the general level of prices for goods and services will rise over a period.