You Own a Stock That Will Produce Varying Rates of Return

question 17

Multiple Choice

You own a stock that will produce varying rates of return based upon the state of the economy.Which one of the following will measure the risk associated with owning that stock?

• A) weighted average return given the multiple states of the economy
• B) rate of return for a given economic state
• C) variance of the returns given the multiple states of the economy
• D) correlation between the returns give the various states of the economy
• E) correlation of the weighted average return as compared to the market

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Definitions:

Contest

A competition where individuals or teams vie for superiority or a prize in a specific area.

Success

The achievement of a set goal, standard, or objective, commonly measured by factors such as profitability, achievement of objectives, or personal fulfillment.

Goodie Bags

Packages filled with gifts, promotional items, or samples, often given to attendees at events or customers as a gesture of appreciation.

Sternberg

A psychologist known for his triarchic theory of intelligence, which categorizes human intelligence into analytical, creative, and practical dimensions.