Matching
Match the following terms with the descriptions below.
Premises:
The chance of a decline in the purchasing power of the monetary unit during the time money is invested.
Exposure to the chance that an unfavorable outcome will occur at some future point in time.
The chance that an investment can not be quickly converted to cash.
A rate of return generated by an investment when there is virtually no chance that the return will not be generated.
An increase in the rate of return expected by an investor for assuming greater investment risk.
A summary measure of an investment's performance, stated as a percentage, based on the possible rates of return and on the likelihood of those rates of return occurring.
A measure of an investment's performance on a common size basis.
Return of the amount initially invested.
Money received in excess of an initial investment.
The risk that a business will not continue to operate.
Responses:
Inflation risk
Risk-free rate of return
Return of investment
Return on investment
Rate of return
Liquidity risk
Risk
Risk premium
Expected rate of return
Business risk
Correct Answer:
Premises:
Responses:
The chance of a decline in the purchasing power of the monetary unit during the time money is invested.
Exposure to the chance that an unfavorable outcome will occur at some future point in time.
The chance that an investment can not be quickly converted to cash.
A rate of return generated by an investment when there is virtually no chance that the return will not be generated.
An increase in the rate of return expected by an investor for assuming greater investment risk.
A summary measure of an investment's performance, stated as a percentage, based on the possible rates of return and on the likelihood of those rates of return occurring.
A measure of an investment's performance on a common size basis.
Return of the amount initially invested.
Money received in excess of an initial investment.
The risk that a business will not continue to operate.
Premises:
The chance of a decline in the purchasing power of the monetary unit during the time money is invested.
Exposure to the chance that an unfavorable outcome will occur at some future point in time.
The chance that an investment can not be quickly converted to cash.
A rate of return generated by an investment when there is virtually no chance that the return will not be generated.
An increase in the rate of return expected by an investor for assuming greater investment risk.
A summary measure of an investment's performance, stated as a percentage, based on the possible rates of return and on the likelihood of those rates of return occurring.
A measure of an investment's performance on a common size basis.
Return of the amount initially invested.
Money received in excess of an initial investment.
The risk that a business will not continue to operate.
Responses:
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