A Stock Has an Expected Rate of Return of 7

question 66

Multiple Choice

A stock has an expected rate of return of 7.3% and a standard deviation of 5.4%.Which one of the following best describes the probability that this stock will lose 9% or more in any one given year?

• A)Less than 0.5%
• B)Less than 1.0%
• C)Less than 1.5%
• D)Less than 2.5%
• E)Less than 5%

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Definitions:

Sanctions

Penalties imposed by governments or organizations on individuals, companies, or countries to encourage compliance with laws or regulations.

Maintaining Good Will

entails fostering positive relationships and perceptions among individuals or groups, often critical for successful long-term interactions or negotiations.

Undesirable Features

Aspects or characteristics of a situation, agreement, or product that are not favorable or appealing.

Attractive Features

Qualities or characteristics of a product, service, or proposition that make it appealing to potential buyers or partners.