Which of the Following Is the Best Description of Investments

question 113

Multiple Choice

Which of the following is the best description of investments in available-for-sale securities?

• A) Investments in bonds that management intends to hold to maturity.
• B) Investments in stocks or bonds that are held primarily for the purpose of selling them in the near future.
• C) Investments in more than fifty percent of the voting stock of another company.
• D) Investments in securities that are accounted for under the market value method other than trading securities and held-to-maturity investments.

---

Definitions:

Constant

A fixed value that does not change.

Slope

A measure of the steepness or incline of a line, represented as the ratio of the vertical change to the horizontal change between two points on the line.

Vertical Axis

The vertical number line of a graph along which values of the y-variable are measured; also referred to as the y-axis.

Linear Relationship

The relationship between two variables in which the slope is constant and therefore is depicted on a graph by a curve that is a straight line.