You Observe the Following Information Regarding Companies X and Y $\bullet$

question 28

Multiple Choice

You observe the following information regarding Companies X and Y: $\bullet$ Company X has a higher expected return than Company Y.
$\bullet$ Company X has a lower standard deviation of returns than Company Y.
$\bullet$ Company X has a higher beta than Company Y.
Given this information, which of the following statements is CORRECT?

• A) Company X has more diversifiable risk than Company Y.
• B) Company X has a lower coefficient of variation than Company Y.
• C) Company X has less market risk than Company Y.
• D) Company X's returns will be negative when Y's returns are positive.
• E) Company X's stock is a better buy than Company Y's stock.

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Definitions:

Geodemographic Segmentation

The process of analyzing and classifying populations based on geography and demographic characteristics to target marketing efforts more effectively.

Internet Marketers

Professionals who specialize in the use of the internet and digital platforms to promote, sell products, and build brand awareness for businesses.

Retailers

Businesses or individuals that sell goods directly to consumers, acting as the final step in the distribution chain from manufacturers to consumers.

Loyalty Segmentation

The process of dividing a customer base into groups based on their loyalty to a brand or company, which can inform targeted marketing strategies.