Briefly Explain the Difference Between Expected Returns and Realized Returns

question 45

Essay

Briefly explain the difference between expected returns and realized returns and between ex ante returns and ex post returns.

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Definitions:

Demand Instrument

A financial document that requires payment of the amount specified on it upon demand by the holder.

Overdue

A state of being late or delayed in completing a payment, task, or fulfilling an obligation beyond the agreed timeframe.

Demand

The desire of purchasers to buy goods or services at a given price, which, combined with supply, determines market prices.

Defect

A flaw or imperfection in a product or system that can lead to its malfunction or inadequacy under expected conditions.