What Can Be Expected to Happen When Stocks Having the Same

question 78

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:

Bulk Pricing

A strategy where goods are sold at a reduced price per unit when purchased in large quantities, encouraging larger purchases by consumers or businesses.

Children's Meals

Specially designed and portioned meals for children, often featuring nutritional considerations and appealing presentations.

Demand Curve

A graph showing the relationship between the quantity of a good consumers are willing to buy and its price.

Marginal Cost

The cost incurred by producing one additional unit of the product.