You Have Developed the Following Data on Three Stocks If You Are a Risk Minimizer, You Should Choose Stock

question 38

Multiple Choice

You have developed the following data on three stocks: $$\begin{array} { l c c } \text { Stock } & \text { Standard Devidion } & \text { Betz } \\\text { A } & 0.15 & 0.79 \\\text { B } & 0.25 & 0.61 \\\text { C } & 0.20 & 1.29\end{array}$$ If you are a risk minimizer, you should choose Stock held as part of a well-diversified portfolio.

• A)A; A
• B)A; B
• C)B; A
• D)C; A
• E)C; B if it is to be held in isolation and Stock If it is to be

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Definitions:

Capital Gains Tax

A tax on the profit realized from the sale of a non-inventory asset that was purchased at a cost amount that was lower than the amount realized on the sale.

Marginal Tax Rate

The percentage of tax applied to your next dollar of income, reflecting the tax bracket into which the last dollar of taxable income falls.

Corporate Tax System

The structure by which businesses are taxed by the government on their profits, incorporating varying rates and regulations depending on the country or jurisdiction.

Targeted Rates

Interest rates or inflation rates that central banks aim for to control economic variables like inflation and unemployment.