You would want to purchase a security if P ________ PV or E(r)________ r.
A)≥; ≤
B)≥; ≥
C)≤; ≥
D)≤; ≤

Question

Quizplus · Accepted Answer

When the price of a security (P) is low, the potential profit is high, making it more attractive to purchase. Therefore, P ≤ PV is the desired condition. However, when it comes to expected return (E(r)), a higher value is always preferred. Therefore, E(r) ≥ r is the desired condition. Hence, the correct answer is C, where P ≤ PV and E(r) ≥ r.

You Would Want to Purchase a Security If P ________