Which of the Following Statements Is FALSE

question 38

Multiple Choice

Which of the following statements is FALSE?

• A)The standard deviation is the square root of the variance.
• B)Because investors dislike only negative resolutions of uncertainty,alternative measures that focus solely on downside risk have been developed,such as the semi-variance and the expected tail loss.
• C)While the variance and the standard deviation are the most common measures of risk,they do not differentiate between upside and downside risk.
• D)While the variance and the standard deviation both measure the variability of the returns,the variance is easier to interpret because it is in the same units as the returns themselves.

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Definitions:

Transactions

Economic interactions or exchanges between parties that involve the transfer of goods, services, or funds.

Investing Activities

Transactions involving the purchase and sale of long-term assets and other investments not related to the day-to-day operations.

Net Cash Provided

The sum of cash inflows minus cash outflows over a period, typically highlighted in a company’s cash flow statement.

Market Securities

Financial instruments that are traded in financial markets, such as stocks, bonds, and derivatives, representing investment vehicles for owners.