Which of the Following Statements Is False

question 45

Multiple Choice

Which of the following statements is false?

• A) A market index reports the value of a particular portfolio of securities.
• B) The S&P 500 is the standard portfolio used to represent "the market" when using the CAPM in practice.
• C) Even though the S&P 500 includes only 500 of the more than 7,000 individual U.S. Stocks in existence, it represents more than 70% of the U.S. stock market in terms of market capitalization.
• D) The S&P 500 is an equal-weighted portfolio of 500 of the largest U.S. stocks.

---

Definitions:

Sales Revenue

The total income received from selling goods or services before any expenses are subtracted.

Other Revenues

Income from activities that are not part of a company's core business operations.

Interest Expense

The cost incurred by an entity for borrowed funds over a period of time.

Goodwill

An intangible asset representing the excess of the purchase price over the fair market value of an acquired company’s net assets.