Which of the Following Equations Is INCORRECT

question 69

Multiple Choice

Which of the following equations is INCORRECT?

• A)E[RxCML] = rf + x(E[RMkt] + rf)
• B)ri = rf + b(E[RMkt] - rf)
• C)SD(RxCML)= xSD(RMkt)
• D)E[RxCML] = (1 - x)rf + xE[RMkt]

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Definitions:

Blanket Lien

A lien that gives the lienor the entitlement to take possession of any or all of the lienee's real and personal property to satisfy a debt.

Chattel Mortgage Agreement

An arrangement where a loan is secured by moveable personal property, which remains in the possession of the borrower.

Trust Receipt

A document issued by a bank to a buyer who has received merchandise but not yet paid for it, acknowledging that the buyer holds the goods in trust for the bank until payment is made.

Revolving-Credit Agreement

A financial agreement permitting a business or person to lend, pay back, and re-lend funds up to an approved borrowing limit.