"If Equivalent Investment Opportunities Trade Simultaneously in Different Competitive Markets,then

question 36

Multiple Choice

"If equivalent investment opportunities trade simultaneously in different competitive markets,then they must trade for the same price in both markets." What do we call the above statement?

• A)the Net Present Value rule
• B)the Law of One Price
• C)the Valuation Principle
• D)the time value of money
• E)an arbitrage opportunity

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Definitions:

Cash Amount

The total value of cash on hand or in bank accounts, easily accessible for immediate use by the business.

Cost of Merchandise Sold

The direct costs attributable to the goods sold by a company, including purchase price, freight, storage, and packaging.

Inventories

Assets held for sale in the ordinary course of business, or in the process of production for such sale, or in the form of materials or supplies to be consumed in the production process.

Cash Payment

Money that is paid out by a business, often documented by a cash disbursement journal.