The ________ Tells Us That the Expected Return on a Risky

question 5

Multiple Choice

The ________ tells us that the expected return on a risky asset depends only on that asset's nondiversifiable risk.

• A) efficient markets hypothesis
• B) systematic risk principle
• C) open markets theorem
• D) law of one price
• E) principle of diversification

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Definitions:

Gross Margin Ratio

A financial metric that shows the proportion of revenue that exceeds the cost of goods sold, indicating the efficiency of production and sales.