Which of the Following Statements Is FALSE

question 131

Multiple Choice

Which of the following statements is FALSE?

• A)We say a portfolio is an efficient portfolio whenever it is possible to find another portfolio that is better in terms of both expected return and volatility.
• B)We can rule out inefficient portfolios because they represent inferior investment choices.
• C)The volatility of the portfolio will differ,depending on the correlation between the securities in the portfolio.
• D)Correlation has no effect on the expected return of a portfolio.

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Definitions:

Security Interest

A legal right or hold on assets that have been pledged as security, typically to ensure the loan is repaid.

Security Registration Legislation

Laws and regulations governing the registration and oversight of securities (stocks, bonds, etc.) to ensure transparency and protect investors.

Automobile

A road vehicle, typically with four wheels, powered by an internal combustion engine or electric motor and used for transportation.

Loan

A sum of money or other resources that is lent to an individual, organization, or entity, typically requiring repayment with interest.