Which of the Following Statements Is FALSE

question 29

Multiple Choice

Which of the following statements is FALSE?

• A)If the market portfolio were not efficient,investors could find strategies that would "beat the market" with higher average returns and lower risk.
• B)The CAPM states that the cost of capital depends only on systematic risk.
• C)Efficient capital markets is a much stronger hypothesis than the CAPM.
• D)The market portfolio is an efficient portfolio.

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Definitions:

Positively Skewed Curve

A set of test scores in which the majority fall at the lower or negative end. It is said to be a positively skewed curve or distribution because a few “positive” or high-end scores have stretched or skewed the curve to the right.

Median

The middle value in a data set when it is arranged in ascending order, or the average of the two middle values if there is an even number of observations.

Negatively Skewed Curve

A set of test scores where the majority fall at the upper or positive end. It is said to be a negatively skewed curve or distribution because a few “negative” or low-end scores have stretched or skewed the curve to the left.

Median

A statistical measure representing the middle value in a sorted list of numbers, effectively dividing the data set into two halves.