Transactions Such as the Purchase of Assets or the Issuance

question 1

Multiple Choice

Transactions such as the purchase of assets or the issuance of debt are not considered income because:

• A) they involve external parties.
• B) they necessarily involve cash.
• C) they do not result in an increase in equity.
• D) they both result in an increase of the asset or liability concerned.

---

Definitions:

Market Components

The different elements that make up a financial market, including stocks, bonds, currencies, commodities, and derivatives.

Expected Returns

The anticipated return on an investment, estimating the average of probability-weighted returns for a given asset.

Probability Distribution

A probability distribution is a mathematical function that provides the probabilities of occurrence of different possible outcomes in an experiment.

Variability

The extent to which data points in a set differ from each other and from the mean of the set; a measure of dispersion or volatility.