Which of the Following Statements Is FALSE

question 96

Multiple Choice

Which of the following statements is FALSE?

• A)In exchange for bearing systematic risk,investors want to be compensated by earning a higher return.
• B)A key step to measuring systematic risk is finding a portfolio that contains only unsystematic risk.
• C)When evaluating the risk of an investment,an investor will care about its systematic risk,which cannot be eliminated through diversification.
• D)To measure the systematic risk of a stock,we must determine how much of the variability of its return is due to systematic,market-wide risks versus diversifiable,firm-specific risks.

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Definitions:

Sensorimotor Stage

The first of Piaget’s stages of cognitive development, characterized by coordination of sensory information and motor activity, early exploration of the environment, and lack of language.

Concrete Operational Stage

Piaget’s third stage, characterized by logical thought concerning tangible objects, conservation, and subjective morality.

Emerging Adulthood

Period of development, roughly spanning the ages of 18 to 25, during which time many young people in affluent nations attend college and graduate school, sort out identity issues, and create life plans.

Identity Issues

Psychological challenges or conflicts centered around one's sense of personal identity and uniqueness.