If an Investment Will Return $1,500 Half of the Time

question 63

Multiple Choice

If an investment will return $1,500 half of the time and $700 half of the time, the expected value of the investment is:

• A) $1,250.
• B) $1,050.
• C) $1,100.
• D) $2,200.

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Definitions:

Federal Securities Acts

Laws enacted by the U.S. federal government designed to regulate the securities industry and protect investors from fraudulent practices.

Significant Losses

Large or impactful financial, material, or reputational reductions experienced by individuals, organizations, or entities.

Private Securities Litigation Reform Act

A 1995 United States federal law that increased the standards for initiating securities fraud litigation to protect companies from frivolous lawsuits.

Illegal Conduct

Activities or actions that are forbidden by law, regulations, or statutes.