You Have the Following Rates of Return for a Risky

question 59

Multiple Choice

You have the following rates of return for a risky portfolio for several recent years:
-The annualized average return on this investment is

• A) 16.15%
• B) 16.87%
• C) 21.32%
• D) 15.60%

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Definitions:

Progressive Tax

A taxation system where the tax rate increases as the taxable amount increases, typically leading to higher earners paying a larger percentage of their income than lower earners.

Tax

A compulsory financial charge or some other type of levy imposed on a taxpayer by a governmental organization in order to fund government spending and various public expenditures.

Proportional

Pertaining to a relationship where quantities change at the same rate, maintaining a constant ratio.

Taxable Income

The portion of an individual's or business's income used to determine how much tax will be owed to the federal government.