Suppose That Some Investors Have Decided That Economic and Financial

question 207

Multiple Choice

Suppose that some investors have decided that economic and financial uncertainty have made the prospect of investing in domestic stock markets more risky than investing in foreign stock markets, and therefore choose to invest in foreign markets.By using all available information as they act to achieve their goals, these investors are exemplifying the economic idea that

• A)people are rational.
• B)people respond to economic incentives.
• C)optimal decisions are made at the margin.
• D)equity is more important than efficiency.

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Definitions:

Hydraulic Pump

A device that converts mechanical energy into hydraulic energy by forcing fluid from a reservoir into a hydraulic system.

Rpm

Stands for revolutions per minute, a measure of the frequency of rotation, specifically the number of rotations around a fixed axis in one minute.

Load

The amount of electrical power or physical weight that is applied or carried by a system or component.

Spool Valves

Mechanical devices used in hydraulic and pneumatic systems to control the flow of fluid or air, typically by moving a cylindrical spool within a housing to open or close channels.