Which of the Following Statements Is False

question 72

Multiple Choice

Which of the following statements is false?

• A) Beta is the expected percent change in the excess return of the security for a 1% change in the excess return of the market portfolio.
• B) Beta represents the amount by which risks that affect the overall market are amplified for a given stock or investment.
• C) It is common practice to estimate beta based on the historical correlation and volatilities.
• D) Beta measures the diversifiable risk of a security, as opposed to its market risk, and is the appropriate measure of the risk of a security for an investor holding the market portfolio.

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Definitions:

Dibutyl Ether

An organic compound formed by the dehydration of butanol, used as a solvent and in chemical synthesis.

Atomic Number

The number of protons in the nucleus of an atom, which defines the element's identity.

Mass Number

The total number of protons and neutrons in an atom's nucleus, representing the atom's mass more closely than the atomic number.

Spectral Data

Information obtained from analyzing the spectrum of light absorbed, emitted, or scattered by materials, used in identifying chemical substances.