The Histograms of the Returns on Large-Company and Small-Company Stocks

question 22

Multiple Choice

The histograms of the returns on large-company and small-company stocks for the period 1926 to 2015 show that

• A)large-company stocks never lost more than 20 percent in any one year.
• B)1945 was the best-performing year for both large-company and small-company stocks.
• C)small-company stocks most commonly return 30 to 40 percent.
• D)small-company stocks are more volatile than large-company stocks.
• E)large-company stocks are riskier than small-company stocks.

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Definitions:

Vasoconstriction

The narrowing of blood vessels, which increases blood pressure by reducing the volume of blood flow.

Growth Hormone

Hormone that stimulates general growth of the individual; stimulates cellular amino acid uptake and protein synthesis; also called somatotropin.

Atrial Natriuretic Hormone

A hormone secreted by the atria of the heart in response to volume expansion and increased blood pressure, inducing diuresis and vasodilation, and reducing blood pressure.

Blood Pressure

The force exerted by circulating blood upon the walls of blood vessels, critical for maintaining bodily functions.