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A Capital Investment That Generates a 10 Percent Rate of Return

Question 22

Multiple Choice

A capital investment that generates a 10 percent rate of return is worthwhile if:


A) Corporate bonds of similar risk offer 8 percent rates of return.
B) Corporate bonds of similar risk offer 10 percent rates of return.
C) top-quality corporate bonds offer 10 percent rates of return.
D) The expected rate of return on the stock market is 12 percent.

Correct Answer:

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