Which of the Following Statements Is FALSE

question 78

Multiple Choice

Which of the following statements is FALSE?

• A)Short-term margin loans from a broker are often 1% to 2% lower than the rates paid on short-term Treasury securities.
• B)In the real world,investors have different information and expectations regarding securities.
• C)The SML is still valid when interest rates differ.
• D)When borrowing and lending occur at different rates there are different tangent portfolios identified.

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Definitions:

Oligopoly

A market structure characterized by a few firms dominating the market, which can lead to limited competition and potentially higher prices for consumers.

Conglomerate

A large corporation composed of diverse companies or divisions in varying industries under one corporate group.

Monopoly

A market structure characterized by a single seller, selling a unique product in the market. In a monopoly market, the seller faces no competition, as he is the sole seller of goods with no close substitute.

Horizontal Merger

A merger occurring between companies in the same industry, often leading to consolidation and potentially impacting competition.