Which of the Following Statements Is FALSE

question 43

Multiple Choice

Which of the following statements is FALSE?

• A)Many practitioners prefer to use average industry betas rather than individual stock betas.
• B)When estimating beta by using past returns it is best to use the longest time horizon of returns available.
• C)The CAPM predicts that a security's expected return depends on its beta with regard to the market portfolio of all risky investments available to investors.
• D)If we use too short a time horizon when estimating beta,our estimate of beta will be unreliable.

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Definitions:

Objective Attributes

Measurable or factual features of a product or service, such as size, weight, or speed, which can be directly observed and quantified.

Subjective Attributes

Characteristics or features of a product or service that are based on personal opinions, tastes, or feelings rather than objective measures.

Temporal States

Conditions or states that are temporary and subject to change over time, often used in psychology and philosophy discussions.

Information Sources

Various means from which information can be obtained, including books, journals, websites, and expert interviews, among others.