The Assumption That States That, If There Is a Production

question 5

Multiple Choice

The assumption that states that, if there is a production activity y that produces a certain amount of output z using capital and labor in particular amounts and another activity w that produces the same quantity using different amounts of these inputs, then we can always produce at least z by mixing these activities and using y a fraction of the time and w a fraction of the time is known as the

• A) additivity assumption
• B) divisibility assumption
• C) convexity assumption

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Definitions:

Expected Return

The anticipated amount of profit or loss an investment is likely to generate over a specific period.

Required Return

The minimum expected return an investor demands for the level of risk taken on an investment.

Dividend

A part of a company's profits given out to its shareholders, often as cash or extra stock.

Growth Rate

A measure of the increase in size, number, value, or strength of something over a specific period of time.