Which One of the Following Statements Must Be True

question 23

Multiple Choice

Which one of the following statements must be true?

• A) All securities are projected to have higher rates of return when the economy booms versus when it is normal.
• B) Considering the possible states of the economy emphasizes the fact that multiple outcomes can be realized from an investment.
• C) The highest probability of occurrence must be placed on a normal economy versus either a boom or a recession.
• D) The total of the probabilities of the economic states can vary between zero and 100 percent.
• E) Various economic states affect a portfolio's expected return but not the expected level of risk.

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Definitions:

Paracelsus

A Swiss physician and alchemist in the Renaissance period, considered one of the fathers of modern toxicology and medicine.

Hypnotism

A trance-like state resembling sleep, typically induced by a therapist by focusing a patient's attention and increasing their responsiveness to suggestions.

Sympathetic Listening

An approach to listening where the listener focuses on understanding the speaker's feelings and emotions.

Humanitarian Approach

An approach that emphasizes the welfare and dignity of people, typically used in contexts of aid and development to alleviate suffering and promote human rights.