Examining Evidence of Returns on Common Stocks and Treasury Bills

question 65

Multiple Choice

Examining evidence of returns on common stocks and Treasury bills indicates that common stocks had

• A)the higher rate of return and the greater risk.
• B)the lower rate of return and the greater risk.
• C)the lower rate of return and the less risk.
• D)the higher rate of return and the less risk.

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Definitions:

Adjusting Entry

An accounting entry made at the end of an accounting period to record earnings or expenses that have occurred but are not yet entered in the accounts.

Asset Account

An account that shows the value of the assets a company controls, which can include cash, equipment, and real estate.

Accrued Interest

Interest that has been incurred but not yet paid, often related to bonds or loans.

Note Receivable

A written promise that a certain amount of money will be paid at a future date, representing an asset for the holder.