You Are Comparing Three Portfolios That Have Differing Treynor Ratios

question 105

Multiple Choice

You are comparing three portfolios that have differing Treynor ratios. Given this, you

• A) Know that the portfolio with the lowest Treynor ratio is under-priced
• B) Should invest in the portfolio with the highest Treynor ratio
• C) Can safely assume that the portfolios have differing levels of total risk
• D) Know the portfolios are all mis-priced
• E) Can safely assume that the portfolios have differing levels of market risk

---

Definitions:

Electromagnetic Spectrum

The electromagnetic spectrum encompasses all types of electromagnetic radiation, from gamma rays to radio waves, differing in wavelength and frequency.

Olfactory Adaptation

The temporary, normal decline in the sensitivity of the olfactory system after exposure to an odor.

Odorant Receptors

Specific proteins located on the olfactory neurons in the nose, responsible for detecting airborne molecules and initiating the perception of smell.

Perilymph

The fluid that fills the space between the membranous labyrinth and the bone that encloses the inner ear, aiding in hearing and balance.