Which of the Following Is the Best Example of a Microeconomic

question 23

Multiple Choice

Which of the following is the best example of a microeconomic topic?

• A) The impact that the money supply has on inflation.
• B) The reasons for increases in the price of soft drinks.
• C) The effect that federal budget deficits have on the interest rate.
• D) The tradeoff between inflation and unemployment.

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Definitions:

Value Line Index

An index that represents the performance of approximately 1,700 stocks in the Value Line Arithmetic and Geometric averages.

Equally-Weighted

An equally-weighted index strategy involves assigning each asset in a portfolio or index the same relative weight, contrasting with market-cap-weighted indexes where larger companies carry more weight.

Reward to Volatility

A measure of the return an investment provides relative to its volatility, used in evaluating the performance of an investment's risk.

Portfolio Excess

Refers to the amount by which the return of a portfolio exceeds the return of a benchmark or risk-free rate.