The Standard Deviation for a Set of Equity Returns Can

question 14

Multiple Choice

The standard deviation for a set of equity returns can be calculated as the:

• A)positive square root of the average return.
• B)average squared difference between the actual return and the average return.
• C)positive square root of the variance.
• D)average return divided by N minus one, where N is the number of returns.
• E)variance squared.

---

Definitions:

Specialization

The practice of focusing effort and resources on a specific task, area of knowledge, or market segment to increase efficiency and proficiency.

Comparative Advantage

The proficiency of an individual, a business, or a nation in generating a product or executing a service at a more economical opportunity cost than its competitors.

Lower Cost

Refers to a situation or strategy in which expenses are minimized or reduced.

Range of Exchange Rates

The variability or difference in the rate at which one currency can be exchanged for another.