Stocks A, B and C Have the Same Risks

question 52

Multiple Choice

Stocks A, B and C have the same risks. Stock A earns an annual return of 12% and Stock B and C earn returns of 11%. Stock A

• A) Is overpriced
• B) Is efficiently priced
• C) Must be a smaller company stock
• D) Has a positive excess return
• E) Must be owned primarily by pessimistic investors

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Definitions:

Earned Income

Earned income is revenue generated from the sale of goods and services. For nonprofits, this includes income earned aside from donations and grants.

Social Enterprise

Social enterprise denotes a business model that aims to address social problems or improve communities, environments, or people's lives through sustainable and revenue-generating strategies.

Board of Directors

A group of elected individuals who represent shareholders or stakeholders, overseeing the activities and governance of an organization to ensure its success and compliance.

Feasibility Analysis

The evaluation of a project or business idea to determine if it is technically, legally, and financially viable.