Which of the Following Performance Measures Is Zero for the Risk-Free

question 88

Multiple Choice

Which of the following performance measures is zero for the risk-free asset?
I. Treynor ratio
II. Sharpe ratio
III. Jensen's alpha

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

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Definitions:

Knowledge Gap

The difference in understanding or information between individuals or groups, especially in relation to access or comprehension of specific subject matter.

Tangibles

Physical items or goods that can be seen, touched, and measured, as opposed to services or digital products.

Responsiveness

The ability of a company, service, or product to react quickly and positively to customer needs or changes in the market.

Reliability

The consistency and dependability of a product, service, or system to perform as expected under certain conditions.