Multiple Choice
Assume that there are two investments similar in all respects, but Investment X has a higher rate of return than does Investment Y. As a result of the arbitrage process, the price of Investment
A) X will fall and its rate of return will fall.
B) Y will rise and its rate of return will fall.
C) X will fall and its rate of return will rise.
D) Y will fall and its rate of return will rise.
Correct Answer:
Verified
Correct Answer:
Verified
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