Which of the Following Statements Is FALSE

question 50

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:

Lapse

A temporary failure to maintain a higher state of wellness or achievement, often seen as a brief return to previous unhealthy behaviors.

High-Risk Situation

Circumstances or environments that have an increased likelihood of leading to negative or undesired outcomes.

High-Risk Situations

Situations that have a higher probability of leading to undesired outcomes or dangers.

Unhealthy Behaviors

Actions or habits that negatively affect an individual’s physical or mental health, such as smoking or excessive drinking.