Which of the Following Statements Is False

question 32

Multiple Choice

Which of the following statements is false?

• A) If the market portfolio is efficient, then all securities and portfolios must plot on the SML, not just individual stocks.
• B) For most stocks the standard errors of the alpha estimates are large, so it is impossible to conclude that the alphas are statistically different from zero.
• C) It is not difficult to find individual stocks that, in the past, have not plotted on the SML.
• D) Small stocks (those with lower market capitalization) have lower average returns.

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Definitions:

Hispanic Identity

The cultural, social, and often national identification of individuals with Hispanic or Latino heritage, encompassing shared language, traditions, and history.

Ethnic Identity

An individual's sense of belonging to a particular ethnic or cultural group, including aspects of tradition, heritage, and language.

Assimilate

The process by which an individual or group takes in and fully understands information or ideas, also can refer to the integration of people into a culture or society.

Stereotype Threat

The risk of confirming negative stereotypes about an individual's racial, ethnic, gender, or cultural group, which can hamper performance in various domains.