Which of the Following Statements Is CORRECT

question 66

Multiple Choice

Which of the following statements is CORRECT?

• A) Portfolio P has a standard deviation of 25% and a beta of 1.0.
• B) Based on the information we are given, and assuming those are the views of the marginal investor, it is apparent that the two stocks are in equilibrium.
• C) Portfolio P has more market risk than Stock A but less market risk than B.
• D) Stock A should have a higher expected return than Stock B as viewed by the marginal investor.

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Definitions:

Amygdala

A part of the brain involved in experiencing emotions, particularly fear and pleasure.

Hippocampus

A part of the brain involved in memory formation, organization, and storage, as well as spatial navigation.

Ponderosa Pine

A large species of pine tree native to western North America, known for its tall stature and distinctive bark.

Amnesia

A loss of memory due to brain injury, disease, or psychological trauma.