Which of the Following Statements Is FALSE

question 31

Multiple Choice

Which of the following statements is FALSE?

• A)While the sign of the correlation is easy to interpret,its magnitude is not.
• B)Independent risks are uncorrelated.
• C)When the covariance equals 0,the returns are uncorrelated.
• D)To find the risk of a portfolio,we need to know more than the risk and return of the component stocks;we need to know the degree to which the stocks' returns move together.

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Definitions:

Smoker's Lung

A condition characterized by respiratory complications and reduced lung function resulting from long-term exposure to tobacco smoke.

DNA Transcribes

The process by which DNA is used as a template to produce messenger RNA (mRNA), initiating protein synthesis.

RNA

Ribonucleic acid, a nucleic acid present in all living cells, playing a role in protein synthesis and the transmission of genetic information.

Polypeptide

An organic linear polymer comprised of numerous amino-acid residues linked in a sequence, which constitutes a portion of or an entire protein molecule.