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A Capital Investment That Generates a 10% Rate of Return

Question 72

Multiple Choice

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


A) corporate bonds of similar risk offer 8% rates of return.
B) corporate bonds of similar risk offer 11% rates of return.
C) top-quality corporate bonds offer 10% rates of return.
D) the expected rate of return on the stock market is 12%.

Correct Answer:

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