Question: Consider two securities, A and B. Suppose a third security, C, has the same cash flows as A and B combined. Using the principle of

Consider two securities, A and B. Suppose a third security, C, has the same cash flows as A and B combined. Using the principle of value added activity and the law of one price, which of the following statements is true?

Price (C) + Price (A) = Price (B)

Price (C) = Price (A + B)

Price (C) = Price (A) + Price (B)

Price (C) - Price (B) = Price (A)

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