In Comparing the Deviations of Returns, Which One of the Following

question 45

Multiple Choice

In comparing the deviations of returns, which one of the following assets has historically had the largest standard deviation of annual returns?

• A) large company stocks
• B) long-term corporate bonds
• C) long-term government bonds
• D) U.S. Treasury bills

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Definitions:

Direct Labor

The labor costs directly attributable to the production of goods or services, which includes wages paid to workers who physically produce the product.

Manufacturing Overhead

All costs related to the production process that are not direct materials or direct labor, known as indirect expenses.

Period Costs

Expenses that are not directly tied to production activity and are expensed in the period they are incurred.

Variable Selling Expense

Costs that vary directly with the volume of sales, such as commissions and shipping charges.