A Graph Measures Y on the Vertical Axis and X

question 160

Multiple Choice

A graph measures y on the vertical axis and x on the horizontal. The curve on the graph is a horizontal line. From this fact we know that

• A) the value of x never changes.
• B) the ratio of x to y is constant.
• C) the slope of the line is not defined because y never changes.
• D) the value of y does not depend on the value of x.

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Definitions:

Marginal Tax Rate

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The extra return expected by investors for holding a risky market portfolio instead of risk-free assets, reflecting the additional risk.

Dividend

The payment made by a corporation to an equity investor (stockholder).