You Want to Invest in a Firm Whose Profits Show

question 41

Multiple Choice

You want to invest in a firm whose profits show small fluctuations throughout the business cycle.Which of the following would you invest in?

• A)a corporation that depended heavily on business fixed investment
• B)a corporation that depended heavily on residential investment
• C)a corporation that depended heavily on consumer nondurables
• D)a corporation that depended heavily on consumer durables

---

Definitions:

Dollar Today

A term reflecting the current purchasing power of the dollar, considering inflation and other economic factors.

Redeem

The act of exchanging a financial security or coupon for its cash value or for goods and services as specified.

Prior To Maturity

A term indicating a situation or action that occurs before a financial instrument, such as a bond, reaches its maturity date.

Callable Bonds

Bonds that can be repurchased by the issuer before their maturity date at a specified call price.