The Expected Rate of Return from an Investment Is Equal

question 41

True/False

The expected rate of return from an investment is equal to the expected cash flows divided by the initial investment.

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Definitions:

Bonds

Fixed income investment products that represent loans made by an investor to a borrower, typically corporate or governmental, which pay periodic interest payments.

Stocks

Shares of ownership in a company, giving shareholders a stake in the company's assets and earnings.

Dividend

A portion of a company's earnings distributed to shareholders, typically in the form of cash or additional stock.

Rate Of Return

The gain or loss of an investment over a specified period, expressed as a percentage of the investment's initial cost.