Which of the Following Is False About the Security Market

question 10

Multiple Choice

Which of the following is false about the security market line (SML) derived from the APT?

• A) The SML has an upward slope.
• B) The SML for the APT shows expected return in relation to factor intensity.
• C) The SML for the APT has an intercept that does not equal the expected return on the market portfolio.
• D) The benchmark portfolio for the SML may be any well-diversified portfolio.
• E) The SML has a downward slope, shows expected return in relation to portfolio standard deviation, and has an intercept equal to the expected return on the market portfolio.

Distinguish between informational, analytical, and other types of business reports.

Understand considerations for web content development and management.

Recognize methods for ensuring reliability and validity in research.

Understand organizational methods for information and reports.

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Definitions:

Correlation

A statistical measure that expresses the extent to which two variables change together, indicating the strength and direction of their relationship.

Descriptive Statistics

Statistical methods that summarize and organize the characteristics of a set of data in order to give a clear overview without drawing conclusions beyond the data itself.

Statistical Significance

The likelihood that a relationship between two or more variables is caused by something other than random chance.

Self-Esteem

A person's self-evaluated sense of their own importance or value.