Author Question: Mr. Jones, an elderly man living on his retirement, pulls 100,000 from certificates of deposit ... (Read 53 times)

mydiamond · **on:** Jun 29, 2018

Mr. Jones, an elderly man living on his retirement, pulls 100,000 from certificates of deposit (CDs), which were returning an annual rate of return of 5.

He thinks the credit freeze is over and stock markets are headed up, but ends up losing 40 in his first year of investing. What was Mr. Jones's rate of economic profit? A) 5
B) 35
C) -35
D) -40
E) -45

Question 2

Which of the following statements is true?

A) The lower the risk in an investment, the higher is the expected return.
B) The higher the risk in an investment, the higher is the expected return.
C) The higher the principal amount of an investment, the lower the rate of interest offered on the investment.
D) The higher the principal amount on the investment, the higher the rate of interest offered on the investment.