If the expected return is above the required return on an asset, ratio
If the expected return is above the required return on an asset, rational investors will:
A) Buy the asset, which will drive the price up and cause expected return to reach the required return.
B) Sell the asset, which will drive the price down and cause the expected return to reach the required return.
C) Sell the asset, which will drive the price up and cause the expected return to reach the required return.
D) Sell the asset, since price is expected to decrease.
ANSWER
A
Expert paper writers are just a few clicks away
Place an order in 3 easy steps. Takes less than 5 mins.