Which of the Following Statements Is False

question 34

Multiple Choice

Which of the following statements is false?

• A) We can improve the performance of our portfolio by selling stocks with negative alphas.
• B) The market portfolio is on the SML, and according to the CAPM, since all other portfolios are inefficient they will not fall on the SML.
• C) The difference between a stock's expected return and its required return according to the security market line is called the stock's alpha.
• D) The risk premium for any security is proportional to its beta with the market.

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Definitions:

Traditional Agriculture

Farming practices that rely on indigenous knowledge, natural resources, and cultural beliefs, often with a focus on sustainability.

Large-Scale Farming

Agricultural operations that involve extensive areas of land and high levels of mechanization and technology to produce large quantities of crops or livestock.

Soil Oxygen

The amount of oxygen present in the soil, essential for the respiration of plant roots and soil organisms.