The Variance of an Investment's Returns Is a Measure of The

question 30

Multiple Choice

The variance of an investment's returns is a measure of the:

• A) volatility of the rates of return.
• B) probability of a negative return.
• C) historic return over long time periods.
• D) average value of the investment.

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Definitions:

Total Assets

The total of all assets owned by a company, including current and non-current assets, representing its value to shareholders.

Sales

Revenue generated from the selling of goods or services within a specific period.

Equity Multiplier

A financial leverage ratio that measures the proportion of a company's assets that are financed by shareholder's equity.

Times Interest Earned

A financial ratio that measures a company's ability to meet its interest obligations, calculated as earnings before interest and taxes (EBIT) divided by interest expenses.