Which of the Following Statements Is FALSE

question 43

Multiple Choice

Which of the following statements is FALSE?

• A)Many practitioners prefer to use average industry betas rather than individual stock betas.
• B)When estimating beta by using past returns it is best to use the longest time horizon of returns available.
• C)The CAPM predicts that a security's expected return depends on its beta with regard to the market portfolio of all risky investments available to investors.
• D)If we use too short a time horizon when estimating beta,our estimate of beta will be unreliable.

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Definitions:

Stakeholders

Individuals, groups, or organizations that are affected by, or have an interest in, the operations and outcomes of a particular project, program, or policy.

Highly Integrated

Being highly integrated refers to systems or processes that are closely interconnected and work seamlessly together to achieve a common goal.

Major Oil Companies

Large, international companies that are involved in the extraction, production, refinement, and distribution of oil.

Environmental Uncertainty

The degree to which future conditions or outcomes are unpredictable within the context of an organization's external environment, influencing strategic planning and decision-making.