Which of the Following Statements Is False

question 66

Multiple Choice

Which of the following statements is false?

• A) The compounded geometric average return is most often used for comparative purposes.
• B) We should use the arithmetic average return when we are trying to estimate an investment's expected return over a future horizon based on its past performance.
• C) The geometric average return will always be above the arithmetic average return and the difference grows with the volatility of the annual returns.
• D) The geometric average return is a better description of the long-run historical performance of an investment.

---

Definitions:

Basic Strength

It refers to fundamental attributes or abilities an individual possesses which form the foundation for more complex skills or behaviors.

Adolescence

The transitional stage of physical and mental development that occurs between childhood and adulthood.

Personality Traits

Enduring characteristics that describe an individual's behavior, attitude, and emotional patterns.

Social Influences

The effects that the presence or actions of others have on an individual's behavior, opinions, or feelings.