What Is the Variance of the Returns on a Security

question 38

Multiple Choice

What is the variance of the returns on a security given the following information?

• A) 239.77
• B) 284.05
• C) 321.16
• D) 347.15
• E) 362.98

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Definitions:

Revealed Preferences

The concept that consumers' choices reveal their preferences and that these choices can be used to infer the utility they derive from different options.

Francs

A currency formerly used in France and some other countries, and still used in some parts of Switzerland and the Pacific.

Consumption

(rephrased) involves the utilization of goods and services by individuals or communities, primarily for personal satisfaction and basic needs.

WARP

WARP, or the Weak Axiom of Revealed Preference, is a consistency criterion for consumer choice behavior, suggesting that if a consumer prefers bundle A over bundle B when both are affordable, they should not choose B when A is still affordable.