Which of the Following Statements Is FALSE

question 19

Multiple Choice

Which of the following statements is FALSE?

• A)Out-of-the-money calls have the highest expected returns and out-of-the-money puts have the lowest expected returns.
• B)The expression SΔ/(SΔ +B)is the ratio of the amount of money in the stock position in the replicating portfolio to the value of the replicating portfolio (or the option price);it is known as the leverage ratio.
• C)The beta of a portfolio is just the weighted average beta of the constituent securities that make up the portfolio.
• D)The magnitude of the leverage ratio for options is usually very small,especially for out-of-the-money options.

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Definitions:

Non-Hispanic White Males

Men who identify as White without Hispanic or Latino ethnicity, often used in demographic and healthcare research.

Gambling Disorder

A behavioral addiction characterized by a persistent and problematic gambling behavior that disrupts personal, family, or vocational pursuits.

Gender-Sensitive Programs

Initiatives or interventions that take into account the differences in gender roles and expectations to ensure fairness and equity in treatment and outcomes.

Substance Abuse

The harmful or hazardous use of psychoactive substances, including alcohol and illicit drugs, leading to addiction or dependence.