Use the Table for the Question(s)below

question 54

Multiple Choice

Use the table for the question(s) below.
Consider the following realized annual returns:
-The standard deviation of the returns on the Index from 2000 to 2009 is closest to:

• A)19.5%.
• B)20.5%.
• C)3.8%.
• D)8.8%.

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Definitions:

Information Omission

Occurs when crucial details are left out of a communication, potentially leading to misinterpretation or a lack of understanding.

Adverse Selection

A situation where asymmetric information leads to the selection of undesirable alternatives in transactions.

Auto Insurance

A policy purchased by vehicle owners to mitigate costs associated with getting into an auto accident.

Precautions

Measures taken in advance to prevent harm or reduce risk.