Fixed Costs

question 20

Multiple Choice

Fixed costs

• A) increase with the level of output
• B) do not change with the level of output
• C) decrease with the level of output

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Definitions:

Risk-free Rate

A theoretical return on an investment with zero risk of financial loss, often represented by government bonds.

Alpha

Alpha is a financial metric indicating the performance of an investment relative to a benchmark index, representing the extra value that a portfolio manager adds or subtracts from a fund's return.

Expected Rate of Return

The projected percentage return on an investment over a given period, factoring in all known variables.

Beta

A measurement of the volatility, or systematic risk, of a security or a portfolio in comparison to the market as a whole.