The Purchase by a Household in China of a CD

question 229

Multiple Choice

The purchase by a household in China of a CD produced in Canada is included in Canadian

• A)consumption expenditures.
• B)investment expenditures.
• C)government purchases.
• D)net exports.
• E)it is not included in Canadian accounts.

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Definitions:

APT

The Arbitrage Pricing Theory, a model that determines the required return on an asset by considering various macroeconomic factors.

CAPM

The Capital Asset Pricing Model, a financial theory that describes the relationship between systematic risk and expected return for assets, particularly stocks.

Firm-Specific Factors

Unique characteristics or circumstances affecting a company that can influence its stock's performance, unrelated to the overall market movements.

Common Macroeconomic Factor

Economic variables that affect a broad segment of the economy and consequently can influence the performance and value of financial investments.