Which of the Following Cases Violates the Property of Transitivity

question 31

Multiple Choice

Which of the following cases violates the property of transitivity?

• A) A∽B, B∽C, A∽C.
• B) A≻B, B≻C, A≻C.
• C) A≻B, B≻C, C≻A.
• D) None of the statements violates the transitivity property.

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Definitions:

Efficient Market

A financial market theory stating that asset prices fully reflect all available information, making it impossible to consistently achieve higher returns than the average market return.

Expected Return

The anticipated amount of profit or loss an investor can foresee from an investment, based on historical data or estimated calculations.

Required Return

The minimum expected return by investors for investing in a particular asset, taking into account the risk level of the investment.

Standard Deviation

A measure of the amount of variation or dispersion of a set of values, widely used in finance to assess the risk of a financial instrument.