Suppose stock A sells for $30 per share and pays dividends of $1 per share per year. Stock B sells for $40 per share and pays dividends of $2 per share per year. Through the process of arbitrage, we would expect the price of:
A. stock A to fall and/or the price of stock B to rise.
B. stock A to rise and/or the price of stock B to fall.
C. both stocks to rise or fall together.
D. neither stock to change.
A. stock A to fall and/or the price of stock B to rise.
Economics
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Most businesses in the United States are organized as
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