Which of the Following Statements Is Correct

question 17

Multiple Choice

Which of the following statements is correct?

• A) Expected returns as estimated by a marginal investor are sometimes positive,but realized returns are always negative.
• B) Expected returns as estimated by a marginal investor are always positive,but realized returns are sometimes negative.
• C) Expected returns as estimated by a marginal investor are sometimes negative,but realized returns are always positive.
• D) Expected returns as estimated by a marginal investor are always negative,but realized returns are sometimes positive.

Understand the concept of cross elasticity of demand and how it indicates the relationship between goods.

Apply the midpoint formula to calculate the price elasticity of demand.

Analyze how changes in price affect the quantity demanded based on the elasticity coefficient.

Determine the elasticity of supply and its implications for pricing decisions.