Which of the Following Statements Is False

question 37

Multiple Choice

Which of the following statements is false?

• A) A combination of portfolios on the efficient frontier of risky investments is also on the efficient frontier of risky investments.
• B) The conclusion of the CAPM that investors should hold the market portfolio combined with the risk-free investment depends on the quality of an investor's information.
• C) The SML holds with some rate r* between r_s and r_b in place of r_f, where r* depends on the proportion of savers and borrowers in the economy.
• D) In reality, investors have different information and spend varying amounts of effort on research for assorted stocks.

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Definitions:

Petty Cash Fund

A small amount of cash kept on hand for minor or incidental expenses.

Credit To Cash

An accounting entry that increases the cash balance in a company's books.

Petty Cash Fund

A small amount of cash on hand used for paying expenses too small to merit writing a check or using a credit card.

Replenished

The process of filling up or restoring a stock or supply of something to its previous level or condition.