Which of the Following Is True

question 28

Multiple Choice

Which of the following is true?
I. A rational choice is made on the margin.
Ii. Microeconomics is the study of the national economy while macroeconomics is the study of the global economy.
Iii. Economists try to understand how the economic world works by testing normative statements.

• A)i and ii
• B)only ii
• C)only iii
• D)only i
• E)i and iii

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Definitions:

Morningstar's RAR

Refers to Morningstar's Risk-Adjusted Return, a calculation used to evaluate the performance of an investment by adjusting for its risk.

Performance Measures

Criteria or metrics used to assess, compare, and track the efficiency, effectiveness, or success of an investment or business operation.

Sharpe Measure

The Sharpe Measure assesses the risk-adjusted return of an investment, comparing its excess return over the risk-free rate to its standard deviation of returns.

Standard Deviation

A measure of the dispersion or variability of a set of values, used in finance to gauge the risk associated with an investment's return.