Which of the Following Is True

question 433

Multiple Choice

Which of the following is true?

• A) The stock market helps channel the savings of individuals into business activities that create wealth.
• B) Individual investors can reduce their risk by holding a large share of their wealth in the form of the stock ownership of a single company.
• C) Historically, the long-term real rate of return of stocks has generally been less than that of bonds.
• D) Mutual funds that have done well in the past are more likely to outperform the market average in the future.

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Definitions:

Overhead

The ongoing administrative and operational costs not directly tied to the production of goods or services in a business.

Operating Efficiency

The ability of an organization to minimize its input costs while maximizing its output without compromising quality.

Boundaryless Sourcing

A business strategy that involves procuring goods or services from any supplier globally without geographical restrictions.

Outsourcing

The practice of hiring third-party vendors to perform services or produce goods that were previously handled in-house.