If Markets Are in Equilibrium,which of the Following Conditions Will

question 1

Multiple Choice

If markets are in equilibrium,which of the following conditions will exist?

• A) Each stock's expected return should equal its realized return as seen by the marginal investor.
• B) Each stock's expected return should equal its required return as seen by the marginal investor.
• C) All stocks should have the same expected return as seen by the marginal investor.
• D) The expected and required returns on stocks and bonds should be equal.
• E) All stocks should have the same realized return during the coming year.

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Definitions:

Components

The constituent parts or elements that make up a system, machine, or device.

Describe

To give a detailed account or picture of something in words, including its characteristics, qualities, or events.

Fear Of Failure

The persistent anxiety or apprehension about not meeting a standard of success or achieving a desired outcome.

Overcome

To successfully deal with or gain control over something challenging, such as an obstacle, difficulty, or adversity.