For Markets to Be in Equilibrium, That Is, for There

question 12

Multiple Choice

For markets to be in equilibrium, that is, for there to be no strong pressure for prices to depart from their current levels,

• A) The past realized rate of return must be equal to the expected future rate of return; that is, .
• B) The required rate of return must equal the past realized rate of return; that is, r = .
• C) The expected rate of return must be equal to the required rate of return; that is, = r.
• D) All of the above statements must hold for equilibrium to exist; that is = r = .
• E) None of the above statements is correct.

---

Definitions:

Exploratory Research

A research approach used to investigate unexplored areas, gather preliminary information, and form hypotheses for further study.

Descriptive

Pertains to the detailed description of characteristics, functions, or phenomena, often used in research to convey clear and vivid images of classifications or conditions.

Exploratory Research

A research approach used to investigate a problem or topic which is not clearly defined, aiming to gain insights and discover initial patterns.

Consumer Thoughts

Refers to the mental activities of individuals regarding their perceptions, attitudes, and decisions about products and services.