The Expected Rate of Return from an Investment Is

question 5

Multiple Choice

The expected rate of return from an investment is:

• A) Only the rate that compensates for time preference
• B) Only the rate that compensates for risk
• C) The rate that compensates for time preference plus the rate that compensates for risk
• D) The rate that compensates for time preference minus the rate that compensates for risk

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Definitions:

Manufacturing Franchise

A type of franchise agreement where the franchisor allows the franchisee to manufacture and sell products using its brand and specifications.

Formula

A mathematical relationship or rule expressed in symbols.

License

A legal permission granted by competent authority to engage in an activity or use a property that would be illegal without such permission.

Trade Name

A business's official name under which it operates and is known to the public, distinct from its legal registered name.