If the Dispersion Around a Stock's Return Increases

question 44

Multiple Choice

If the dispersion around a stock's return increases

• A)the expected return decreases
• B)the standard deviation decreases
• C)the stock's price increases
• D)the stock's risk increases

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Definitions:

Linchpin

A critical element, person, or thing that holds something together or is essential to its stability and operation.

Atlantic Trading System

The network of trade routes connecting Europe, Africa, and the Americas from the 16th to the 19th century, facilitating the exchange of goods, people (including slaves), and culture.

Slaves

Individuals who are legally owned by others and are forced to work without pay, often without any rights or freedoms.

Tuscarora War

A conflict between the British, Dutch, and German settlers and the Tuscarora Native Americans in North Carolina during the early 18th century, leading to the defeat and relocation of the Tuscarora.