Which of the Following Statements Is FALSE

question 78

Multiple Choice

Which of the following statements is FALSE?

• A)Securities that tend to move more than the market have betas lower than 0.
• B)Securities whose returns tend to move in tandem with the market on average have a beta of 1.
• C)Beta corresponds to the slope of the best-fitting line in the plot of the securities excess returns versus the market excess return.
• D)The statistical technique that identifies the best-fitting line through a set of points is called linear regression.

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Definitions:

Organic Molecules

Chemical compounds containing carbon atoms bonded together and with other elements, typically forming the basis of life on Earth.

Base

A substance that can accept hydrogen ions (protons) or more generally, donate a pair of valence electrons in reactions.

Brønsted-Lowry

The Brønsted-Lowry theory defines acids as proton (H+) donors and bases as proton acceptors, emphasizing the role of proton transfer in acid-base reactions.

Hydrogen Ion

An atom of hydrogen that has lost its electron, resulting in a positively charged ion, H+.