The Amount of Risk Premium Allocated to Security a Is

question 59

Multiple Choice

The amount of risk premium allocated to Security A is dependent upon which one of the following?

• A)unsystematic risk associated only with Security A
• B)total risk associated with Security A's classification
• C)total surprise associated with Security A
• D)the difference between the expected return and the actual return on Security A
• E)systematic risk associated with Security A

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Definitions:

Validity

The degree to which a test actually measures what it’s supposed to measure.

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Freud

Sigmund Freud was an Austrian neurologist and the founder of psychoanalysis, a clinical method for treating psychopathology through dialogue between a patient and a psychoanalyst.

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