An Investor Estimates the Expected Return of Option a to Be

question 16

Multiple Choice

An investor estimates the expected return of option A to be $180,000 and its expected utility to be 400. The expected return of option B is $120,000, and its expected utility is 450. The investor should:

• A) select option A because it has the higher expected return.
• B) select option B because it has the higher expected utility.
• C) select option A because 180,000/120,000 > 450/400.
• D) be indifferent between option A and option B.
• E) There is not enough information to answer this question.

Identify the roles and limitations of the SEC in establishing accounting principles.

Recognize the significance and impact of major federal securities laws.

Know the filing requirements and timing for various SEC forms.

Understand the components and requirements of financial statements and proxy statements as regulated by the SEC.

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Definitions:

Military Tribunals

Special courts designed to try members of the armed forces or enemy combatants, often distinguished from civilian courts for their focus on military law and discipline.

Civil Courts

Courts responsible for resolving non-criminal disputes, including cases involving contracts, property, and family law among others.

Gold Standard

A monetary system in which the standard economic unit of account is based on a fixed quantity of gold, enabling the conversion of currency into a certain amount of gold on demand.

Financial Policy

A government's strategy for managing its money, including taxation, spending, and borrowing decisions.