Into Which Category of Aggregate Expenditure Would Each of the Following

question 163

Essay

Into which category of aggregate expenditure would each of the following transactions fall?
a.Sandra MacMillian purchases a new Ford Focus.
b.The city of Richardson buys 5 new garbage trucks.
c.Adrian Garcia buys a newly constructed townhome.
d.A consumer in Latvia orders an iPhone from Apple.
e.Ford Motor Company buys 300 new iPhones from Apple.

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Definitions:

Market Risk Premium

The additional return an investor expects to receive from holding a risky market portfolio instead of risk-free assets.

SML

Stands for Security Market Line, a graphical representation of the expected return of investments at different levels of systematic, or market, risk.

Beta

An indicator of how much a stock's price is expected to fluctuate, compared to fluctuations in the overall stock market.

Required Rate of Return

The minimum annual percentage return an investor expects to earn from an investment to consider it worthwhile.