Which of the Following Is True About Investment

question 64

Multiple Choice

Which of the following is true about investment?

• A) In a competitive capital market, private investors have a strong incentive to evaluate projects carefully and allocate their funds toward those projects expected to yield the highest rates of return.
• B) In a competitive environment, profitable investment projects will tend to increase the wealth of the nation.
• C) When investment funds are allocated by governments (rather than capital markets), political clout rather than the expected rate of return will generally determine which projects are undertaken.
• D) All of the above are correct.

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Definitions:

Confidence Level

In statistics, it represents the degree of certainty or probability that a parameter lies within a specified range.

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Plus Four Confidence Interval

A variation of the confidence interval estimate that includes an adjustment for small sample sizes.

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