Which One of These Statements Is Correct Concerning Expected and Unexpected

question 368

Multiple Choice

Which one of these statements is correct concerning expected and unexpected returns?

• A) Total return is equal to the expected return.
• B) The unexpected return is solely related to unsystematic risk.
• C) The unexpected return is solely related to systematic risk.
• D) The unsystematic portion of the surprise component of a return is diversifiable risk.
• E) Total return is equal to the expected return minus the surprise.

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Definitions:

Disposable Income

Financial means left for households to spend and save after income tax obligations.

APC

Average Propensity to Consume refers to the ratio of consumption expenditure to income.

APC

Commonly stands for Armored Personnel Carrier, but in economic contexts, it can refer to the Average Propensity to Consume, which indicates the fraction of income that is spent on consumption.

APS

Acronym for Accumulated Plan Savings, often related to retirement saving plans; or it could also mean Anti-Phishing Security, depending on the context.