Which of the Following Statements Is Most Correct

question 11

Multiple Choice

Which of the following statements is most correct?

• A)As levels of income decrease, an individual may dissave, that is, reduce further consumption expenditures rather than liquidate accumulated savings.
• B)The ability to provide adequate funds to meet our investment needs is dependent primarily on the savings of corporations and the government.
• C)In terms of the amount of funds raised annually in the credit markets, borrowing by the state and local government sector is smaller than borrowing by the U.S.government.
• D)All of the above statements are correct.

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Definitions:

Gains And Losses

The increase or decrease in an investment's value, respectively, often realized upon selling or valuing the investment at market price.

DAX-30 Index Futures

Futures contracts that speculate on the future value of the DAX, a stock index of 30 major German companies trading on the Frankfurt Stock Exchange.

Underpriced

A term describing a security or other asset that is selling for a price considered to be below its intrinsic or true value.

Arbitrage Profit

The profit made from buying and selling identical assets in different markets or formats to take advantage of differing prices for the same asset.