What Can Be Expected to Happen When Stocks Having the Same

question 32

Multiple Choice

What can be expected to happen when stocks having the same expected risk do not have the same expected return?

• A) at least one of the stocks becomes temporarily mispriced
• B) this is a common occurrence indicating that one stock has more PVGO
• C) this cannot happen if the shares are traded in an auction market
• D) the expected risk levels will change until the expected returns are equal

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Definitions:

Demand And Supply

Fundamental economic concepts representing the desire for goods and services by consumers and the amount of goods and services available in the market.

Price Elasticity Of Demand

A measure of how much the quantity demanded of a good responds to a change in its price, indicating the sensitivity of consumers to price changes.

Health Care

The organized provision of medical services to individuals or communities to maintain or improve health.

Total Health Care Expenditures

The total amount of money spent on health care services and products in a specific period, often measured annually.