Economics (McConnell) AP Edition, 19th EditionChapter 34:
Financial EconomicsAfter reading this chapter, you should be able to: - Describe the idea of present value and explain why it is critical in making financial decisions.
- Identify and distinguish between the most common financial investments: stocks, bonds, and mutual funds.
- Discuss how investment returns compensate for being patient and for bearing risk.
- Explain portfolio diversification and why it implies that investors can focus on nondiversifiable risk when evaluating an investment opportunity.
- Interpret why higher levels of nondiversifiable risk are associated with higher rates of return.
AP Chapter 34 Introduction
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