Which Security Has the Greatest Expected Return

question 273

Multiple Choice

Which security has the greatest expected return?

• A) Y because it has the largest standard deviation.
• B) X because it has the largest beta coefficient.
• C) Z because it has the highest ratio of standard deviation to beta.
• D) Y because it has the lowest beta coefficient, and therefore the lowest risk.
• E) It is not possible to tell given the information above.

Comprehend how financial leverage impacts company's financial sustainability and shareholder's equity.

Determine the effects of transactions on liquidity ratios such as the current ratio and the acid-test (quick) ratio.

Analyze how actions affect financial metrics, specifically ratios regarding profitability, liquidity, and solvency.

Grasp the relationship between market valuations like the price-earnings ratio and underlying financial performance metrics.

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Definitions:

Calories

Units of energy used to measure the energy content in food, necessary for human life and activity.