An Annualized Return

question 25

Multiple Choice

An annualized return:

• A)is less than a holding period return when the holding period is less than one year.
• B)is expressed as the summation of the capital gains yield and the dividend yield on an investment.
• C)is expressed as the capital gains yield that would have been realized if an investment had been held for a twelve-month period.
• D)is computed as (1 + holding period percentage return)^m, where "m" is the number of holding periods in a year.
• E)is computed as (1 + holding period percentage return)^m, where "m" is the number of months in the holding period.

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Definitions:

White-collar Employment

Jobs that typically involve professional, managerial, or administrative work, often in an office setting, as opposed to blue-collar jobs that involve manual labor.

Substitution Effect

The change in demand for a good due to a change in its price, leading consumers to substitute it with another product.

Output Effect

When the price of any resource rises, the cost of production rises, which, in turn, lowers the supply of the final product. When supply falls, price rises, consequently reducing output.

Marginal Revenue Product

The additional revenue generated from employing one more unit of a factor of production, holding all other factors constant.