Which of the Following Types of Assets Offers the Highest

question 16

Multiple Choice

Which of the following types of assets offers the highest expected return?

• A)Stocks.
• B)Long-term government bonds.
• C)Options and futures.
• D)Long-term corporate bonds.

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Definitions:

Depreciation Rate

The percentage rate at which an asset is depreciated across its useful life, affecting the value of the asset on the balance sheet over time.

Straight-Line Method

A method of calculating depreciation by dividing the cost of an asset, minus its salvage value, by its useful life.

Residual Value

The estimated scrap or salvage value of an asset at the end of its useful life.

Depreciation Expense

The allocation of the cost of a tangible asset over its useful life, reflecting the decrease in value of the asset over time due to use, wear, or obsolescence.