If the Savings Interest Rate Rises, to Maintain the Financial

question 39

Multiple Choice

If the savings interest rate rises, to maintain the financial asset arbitrage equality, either the ________ or the ________, or both.

• A) equity falls; price-to-equity ratio falls
• B) risk premium falls; dividends rise
• C) capital depreciation rises; investment rate rises
• D) dividends rise; capital gain rises
• E) marginal product of capital falls; user cost falls

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Definitions:

Categorical Proposition

An assertion that confirms or rejects a characteristic for every individual in a class.

Forms A, E, I, O

The four basic types of categorical propositions in traditional logic, distinguished by their quality (affirmative or negative) and quantity (universal or particular).

Subject

The part of a sentence or clause referring to the person or thing that is doing or being something; in logic, it can refer to the entity being discussed or described.

Predicate

The part of a sentence or clause containing a verb and stating something about the subject (e.g., went home in "John went home").