Choose the Word or Phrase in [ ] Which Will

question 86

Short Answer

Choose the word or phrase in [ ] which will correctly complete the statement. Select A for the first item, B for the second item, and C if neither item will correctly complete the statement.
-More speculative investors would prefer stocks with [higher | lower] betas.

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Definitions:

Variable Costs

Costs that change in proportion to the level of activity or volume of production in a business.

Pretax Income

The amount of income that a company earns before any taxes are deducted.

Variable Cost

Costs that vary in direct proportion to changes in the level of production or sales activity.

Fixed Costs

Costs that do not fluctuate with the level of production or sales activity, such as rent, salaries, and insurance premiums, remaining constant regardless of business volume.