Only Capital Gains That Have Been Realized Should Be Included

question 93

True/False

Only capital gains that have been realized should be included in the measurement of a portfolio's return over a given period of time.

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Definitions:

Special Order

An order for a product or service that is outside the company's standard offerings, often requiring customization.

Capacity

The maximum level of output that a company can sustain to produce in a given period under normal circumstances.

Sunk Costs

Sunk costs are past expenses that have already been incurred and cannot be recovered, and thus should not affect future business decisions.

Opportunity Costs

The loss of potential gain from other alternatives when one alternative is chosen.