Which of the Following Is an Example of an Arbitrage

question 7

Multiple Choice

Which of the following is an example of an arbitrage opportunity?

• A)You can play a game in which you will win $100,000 if you draw any card but an ace out of a 52-card deck. If you draw an ace, however, you pay only $1.00.
• B)You have found an investment that is guaranteed to offer you a 100% return on your investment in one year.
• C)You are able to borrow money today for one year at 3% and simultaneously invest the proceeds in a project that is guaranteed to return 15% at the end of the year. There are no
• Transaction costs associated with either the loan or the investment.
• D)None of the above is an arbitrage opportunity.

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Digital material available on the internet, including articles, videos, music, and images.

Polysemy

The capacity for a word or phrase to have multiple related meanings.

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