If the Variability of the Returns on Large-Company Stocks Were

question 70

Multiple Choice

If the variability of the returns on large-company stocks were to increase over the long-term,you would expect which of the following to occur as a result?
I.decrease in the average rate of return
II.increase in the risk premium
III.increase in the 68 percent probability range of the frequency distribution of returns
IV.decrease in the standard deviation

• A)I only
• B)IV only
• C)II and III only
• D)I and III only
• E)II and IV only

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