Since About 1900,the Standard Deviation of Annual Returns on a Portfolio

question 22

Multiple Choice

Since about 1900,the standard deviation of annual returns on a portfolio of U.S.common stocks has been about:

• A) −10%.
• B) 6%.
• C) 20%.
• D) 12%.

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Definitions:

Net Income

The amount of profit a company has left after all expenses, taxes, and costs have been subtracted from total revenue.

Net Working Capital

The difference in a company’s readily available assets versus its current financial obligations, marking its short-term economic status.

Statement of Financial Positions

A financial report that presents a company's assets, liabilities, and equity at a specific point in time, giving insight into its financial health.

Comprehensive Income

The total change in equity for a reporting period other than from transactions with owners, including all revenues, gains, expenses, and losses.