21-17.The New Equilibrium Theory Suggests That

question 2

Multiple Choice

21-17.The New Equilibrium Theory suggests that:

• A) all assets in a portfolio have equal returns when diversified
• B) the excess returns on real estate are a reward for the unique risk characteristics of real estate
• C) the low returns on real estate are due to their inflation hedge characteristics
• D) none of the above

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Definitions:

Classical

Pertaining to the first significant period or highest standard within any discipline; in psychology, often refers to conditions or experiments that form the basis of behaviorism, such as classical conditioning.

Pavlov

A Russian physiologist best known for developing the concept of the conditioned reflex through experiments with dogs, leading to the foundation of classical conditioning in behaviorism.

Law of Effect

A principle suggesting that responses that produce a satisfying effect in a particular situation become more likely to occur again in that situation, while responses that produce a discomforting effect become less likely.

Titchener

Edward Bradford Titchener, an early 20th-century psychologist, known for developing the theory of structuralism, which focused on understanding the structure of the mind through introspection.