If a Stock Were Overpriced, It Would Plot

question 54

Multiple Choice

If a stock were overpriced, it would plot

• A)above the security market line.
• B)below the security market line.
• C)on the security market line.
• D)on the y-axis.

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Definitions:

Doctrine of Constructive Notice

A principle in law whereby individuals are assumed to be aware of their legal rights and obligations, even if they do not possess actual knowledge of them.

Indoor Management Rule

A party dealing with a corporation may assume that the officers have the valid and express authority to bind the corporation.

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made to a second party if the latter has reasonably relied on that promise to their detriment.

Personal Liability

The legal responsibility of an individual to satisfy debts or obligations from their personal assets when they cannot be met through insurance or other protections.