Case 3 Matthew Has His New Computer System in Place

question 31

Multiple Choice

Case 3 Matthew has his new computer system in place and is ready to have an Internet connection. He is overwhelmed by the variety of choices for home Internet connections. For instance, he could choose to connect using an existing telephone line or dial-up connection. He could also use a cable modem, ISDN (Integrated Services Digital Network) , DSL (Digital Subscriber Line) , or satellite Internet service. Which of the Internet connections is always-on and does not require proximity to a telephone switching station?

• A) cable modem
• B) dial-up
• C) DSL (Digital Subscriber Line)
• D) ISDN (Integrated Services Digital Network)

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Definitions:

Required Rate

The minimum return that investors demand for investing in a specific asset or undertaking a project.

Risk Premium

The additional return an investor expects to receive from an investment by taking on a higher level of risk.

Risk-Free Interest

Risk-free interest is the theoretical rate of return of an investment with zero risk, serving as a benchmark for evaluating the risk and return of other investments.

Negative Beta Stocks

These are stocks that tend to move inversely to the overall stock market; when the market rises, these stocks' prices may fall, and vice versa.