Which of the Following Statements Is FALSE

question 39

Multiple Choice

Which of the following statements is FALSE?

• A)A conclusion of the CAPM that investors should hold the market portfolio only if they have high quality information.
• B)A conclusion of the CAPM that investors should hold the market portfolio even if they do not have high trading skills.
• C)Even naive investors with no information should hold the market portfolio.
• D)The CAPM assumption of homogeneous expectations is not necessarily a good description of the real world.

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Definitions:

Breach Of Warranty

Occurs when a product or service fails to meet the terms or conditions explicitly or implicitly stated in a warranty agreement.

Material

Pertaining to or consisting of physical substances, or in legal contexts, information of such significance that it could influence a decision.

Insurer's Risk

The risk borne by an insurance company, being the potential financial loss they accept when providing policies to insureds.

Liability Insurance

A type of insurance coverage that protects an individual or entity from the risk of being held legally liable for injuries or damages to others.