Suppose That Jamal Is Moving to a State Where Personal

question 105

Multiple Choice

Suppose that Jamal is moving to a state where personal incomes are distributed randomly. If Jamal believes in liberalism, he would prefer

• A)an income distribution that is relatively equal.
• B)that everyone has the same work opportunities and market-determined wage rates.
• C)that private property be transformed to government property to safeguard people's incomes.
• D)less economic assistance to the poor because it distorts the price system.

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Definitions:

Standard Deviation

A statistical measure of the dispersion of returns for a given security or market index, often used to gauge the amount of variability or volatility of an investment.

Expected Return

The weighted average of all possible returns from an investment, considering the probabilities of each outcome.

Efficient Frontier

A concept in modern portfolio theory representing the set of optimal portfolios that offer the highest expected return for a defined level of risk or the lowest risk for a given level of expected return.

Standard Deviation

A statistic that measures the dispersion of a dataset relative to its mean and is used as a measure of volatility.