Economic efficiency is enhanced when funds flow to the location with the ____ risk-adjusted return.
A)highest
B)lowest
C)natural
D)lowest natural

Question

Quizplus · Accepted Answer

Economic efficiency is achieved when funds flow to where they can earn the highest risk-adjusted returns. This encourages investment in projects that generate the greatest economic value and maximizes the benefits to society as a whole. In contrast, investing in projects with lower risk-adjusted returns would result in a lower economic benefit and a waste of resources. Therefore, the correct choice is A.

Economic Efficiency Is Enhanced When Funds Flow to the Location