In an Efficient Market, an Average Investor Who Is Outside

question 15

Multiple Choice

In an efficient market, an average investor who is outside Wall Street

• A)must be constantly vigilant by analyzing and adjusting their portfolio to get average returns.
• B)cannot expect to get average returns.
• C)will get average returns in a well-diversified portfolio even without analyzing or managing it.
• D)will habitually exceed average returns.

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Definitions:

Responsibility Centre

A management accounting tool in which parts of an organization are allocated responsibility for controlling costs, revenues, or investments.

Control Purposes

Activities or measures implemented to ensure that operations are conducted as planned and resources are used efficiently.

Direct Material

Direct Material refers to the raw materials that are directly incorporated into a finished product and are a significant part of manufacturing costs.

Cost Per Equivalent Unit

A method used in process costing that calculates the cost assigned to goods based on the stage of completion.