Which One of the Following Statements Is True

question 81

Multiple Choice

Which one of the following statements is true?

• A)When an investor buys stocks and assumes they will increase in value, he or she is using a procedure called selling short.
• B)Selling short is selling stock that has been borrowed from a brokerage firm.
• C)When you sell short, you buy today, knowing you must sell or cover your short transaction, at a later date.
• D)In a short transaction, if the stock increases in value, the investor makes money.
• E)To make money in a short transaction, you must hold on the stock for at least one year.

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Definitions:

Gourmet Foods

High-quality or exotic ingredients and prepared foods that are often more costly and sought after for their unique flavors and presentation.

Merchandisers

Merchandisers are businesses or individuals that purchase goods for the purpose of selling them to consumers at a profit.

Year-End Adjustments

Year-end adjustments are accounting entries made at the end of an accounting period to update accounts for accurate financial reporting.

Convertible to Cash

Assets that can be quickly and easily transformed into cash without losing significant value.