If Investors Are Risk Averse and Hold Only One Stock,we

question 145

True/False

If investors are risk averse and hold only one stock,we can conclude that the required rate of return on a stock whose standard deviation is 0.21 will be greater than the required return on a stock whose standard deviation is 0.10.However,if stocks are held in portfolios,it is possible that the required return could be higher on the stock with the lower standard deviation.

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Definitions:

Whooping Cough

An infectious bacterial disease that causes uncontrollable, violent coughing which can make it hard to breathe; also known as pertussis.

Pertussis

A highly contagious respiratory infection also known as whooping cough, caused by the bacterium Bordetella pertussis.

Viral Conjunctivitis

An eye infection caused by a virus resulting in redness, itching, and watering of the eyes.

Incubation Period

The time interval between the entry of an infectious agent into the body and the appearance of the first symptoms of the disease.