If the Market Is Efficient and Securities Are Priced Fairly

question 141

Multiple Choice

If the market is efficient and securities are priced fairly then the _____ will be constant for all securities.

• A) Systematic risk.
• B) Standard deviation.
• C) Reward-to-risk ratio.
• D) Beta.
• E) Risk premium.

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Definitions:

Employee Fraud

Dishonest activities conducted by employees to provide them with an advantage, financial or otherwise, at the expense of their employer.

Inventories

Goods and materials that a business holds for the purpose of resale or production.

Manufacturers

Manufacturers are entities engaged in the transformation of raw materials or components into finished goods that are sold to consumers, businesses, or other manufacturers.

Product Costs

The total expenses incurred to produce a product including direct materials, direct labor, and manufacturing overhead.