Which of the Following Statements Is FALSE

question 6

Multiple Choice

Which of the following statements is FALSE?

• A)The size effect is the observation that small stocks have positive alphas.
• B)When considering portfolios formed based on the book-to-market ratio,most of the portfolios plot below the security market line.
• C)The largest alphas occur in the smallest size deciles.
• D)When considering portfolios formed based on size,although the portfolios with the higher betas yield higher returns,most size portfolios plot above the security market line.

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Definitions:

1964 Civil Rights Act

Landmark legislation in the United States that outlawed discrimination based on race, color, religion, sex, or national origin.

Disparate Impact

A legal theory under civil rights laws that practices may have discriminatory effects, even if not intentionally discriminatory.

Seniority Systems

Employment practices that prioritize job benefits and promotions based on the length of an individual's service or tenure.

Employment-at-will Doctrine

A legal principle that allows either the employer or the employee to terminate employment at any time without reason, as long as it is not illegal.