Which of the Following Statements Is TRUE

question 79

Multiple Choice

Which of the following statements is TRUE?

• A)Portfolios with lower volatility have historically rewarded investors with higher average returns.
• B)Individual stocks with higher volatility have consistently rewarded investors with higher average returns.
• C)Volatility seems to be a reasonable measure of risk when evaluating returns on large portfolios.
• D)Volatility seems to be a reasonable measure of risk when evaluating returns on individual stocks.

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Definitions:

Exchange Rate

The price at which one currency can be exchanged for another.

Euros

The eurozone's recognized currency, used by 19 out of the 27 member states of the European Union.

Foreign Exchange Market

A global decentralized or over-the-counter market for trading currencies.

British Pounds

British pounds, or the pound sterling, is the official currency of the United Kingdom, represented by the symbol £.