If the Investor Desires Less Risk Than the Market,he or She

question 76

Multiple Choice

If the investor desires less risk than the market,he or she:

• A) buys stocks with alphas of zero.
• B) buys stocks with betas less than 1.0.
• C) makes sure the risk-free rate is higher than the expected market return.
• D) buys stocks only when the slope of the security market line is on a 45 degree angle.

---

Definitions:

Germany

A country in Central Europe known for its history, cultural heritage, and as a major economic and political power.

Dissolution

The legal process of ending the existence of a legal entity or agreement, such as a corporation or marriage.

Continuation Agreement

An agreement to extend the terms of a contract or arrangement beyond its original expiration date, often with some modifications.

Partnership Agreement

A contract between partners in a business that outlines the terms of the partnership, including contributions, management, and profit distribution.