Which of the Following Statements Is FALSE

question 8

Multiple Choice

Which of the following statements is FALSE?

• A)A significant fraction of investors might care about aspects of their portfolios other than expected return and volatility,and so would be unwilling to hold inefficient investment portfolios.
• B)Although the true market portfolio of all invested wealth might be efficient,the proxy portfolio might not track the actual market very well.
• C)We might be using the wrong proxy portfolio when we calculate alphas.
• D)The true market portfolio consists of all traded investment wealth in the economy.

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Definitions:

Direct Expense

Costs that can be directly attributed to a specific product, service, or department within a business.

Indirect Expense

Costs that are not directly attributable to a specific product or service, such as utilities or administrative salaries.

Rent

A periodic payment made by a tenant to a landlord in exchange for the use of land, a building, or other property.

Contribution Margin

The difference between sales revenue and variable costs, indicating how much revenue contributes to fixed costs and profits.