Solve the Problem $\frac { 209 } { 10368 } \approx 0.020158$

question 190

Multiple Choice

Solve the problem.
-A test has 11 questions. Seven questions are true/false and four are multiple-choice. Each multiple-choice question has 3 possible responses of which exactly one is correct. Find the
Probability that a student guesses on each question and gets a perfect score.

• A) \(\frac { 209 } { 10368 } \approx 0.020158\)
• B) \(\frac { 1 } { 10,368 } \approx 0.000096\)
• C) \(\frac { 1 } { 3,136 } \approx 0.000319\)
• D) \(\frac { 1 } { 168 } \approx 0.005952\)

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Definitions:

Systematic Risk

The risk inherent to the entire market or market segment, not reducible through diversification.

Security Market Line

A line on a chart that displays the relationship between risk and the expected return of the market portfolio. It serves as a graphical representation of the Capital Asset Pricing Model (CAPM).

Beta Coefficient

A framework for quantifying the variability, or orderly risk, of a security or investment compilation when juxtaposed with the general market.

Risk Premium

The additional return an investor demands for choosing a risky investment over a risk-free option, serving as compensation for the additional risk.