Which of the Following Is True Regarding the Coefficient of Variation

question 48

Multiple Choice

Which of the following is true regarding the coefficient of variation (CV) ?

• A)All other measures being equivalent,the optimal strategy is to choose the action or option with the highest CV.
• B)The CV gives an absolute measure of variability among the options.
• C)The return-to-risk ratio (RTRR)is a function of the CV.
• D)In choosing between the CV and the RTRR,the better strategy is to choose the CV.

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Definitions:

Price Elastic

A measure of how much the quantity demanded of a good responds to a change in the price of that good. It indicates the sensitivity of consumers to price changes.

Total Revenue

The total income received by a firm from the sale of its products or services before any expenses are deducted.

Total Revenue

The overall revenue a business earns from sales of goods or provision of services throughout a given timeframe.

Price Falls

Occurs when the market price of a good or service decreases over time.