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The Collections of Financial Instruments That Each Have Returns Defined

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The collections of financial instruments that each have returns defined by a probability distribution and used to obtain a combined investment with expected risks and returns are called:


Definitions:

Normal Goods

Goods for which demand increases as the income of the consumer increases.

Current Consumption

The portion of income or wealth that is spent on goods and services in the present, as opposed to saving for future expenditure.

Future Consumption

The saving or postponing of consumption today in order to consume in the future, often considered in economic theories of savings and investment.

Real Rate

The interest rate adjusted for inflation, reflecting the real purchasing power of interest earnings.

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