The Variance or Standard Deviation Measures the Risk Per Unit

question 55

True/False

The variance or standard deviation measures the risk per unit of return.

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Definitions:

Required Rate

The minimum expected rate of return by investors for providing capital to a company, often used in valuing investments.

Constant Dividend

A fixed amount of money paid to shareholders of a corporation out of its earnings on a regular basis.

Required Return

The minimum expected return an investor seeks on an investment, factoring in the risk associated with it.