When High Growth Is Expected in the Economy, an Investor

question 39

Multiple Choice

When high growth is expected in the economy, an investor should receive higher returns from:

• A) cyclical investments.
• B) countercyclical investments.
• C) stocks with negative correlations.
• D)stocks with low standard deviations.

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Definitions:

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period of time.

Continuing Operations

The segments or units of a business that are expected to continue operations into the foreseeable future, as opposed to those segments that are being discontinued or sold.

Comparative Financial Statements

Financial statements that provide a comparison of a company's financial performance and position over multiple periods.

Percentage Analysis

A financial analysis technique that expresses each item in a financial statement as a percentage of a base amount to identify trends and make comparisons.