In Recent Years, What Has Been the Status of the U.S

question 53

Multiple Choice

In recent years, what has been the status of the U.S. trade balance?

• A) a record-setting surplus
• B) a record-setting deficit
• C) roughly equal
• D) equalized through government bailouts
• E) no longer calculated because of NAFTA and other free-trade agreements

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Definitions:

Capital Asset Pricing Model

A model used to determine the theoretical rate of return of an asset, considering the asset’s risk relative to that of the market.

Beta

A measure used in finance to describe the relationship of an investment's returns with those of the market; it indicates the investment's risk compared to the market.

Rate of Return

The increase or decrease in the value of an investment throughout a certain timeframe, represented as a portion of the investment's initial cost.

Risk Premium

The risk premium is the extra return above the risk-free rate that investors demand as compensation for the risk of investing in a particular asset.