Which Statement Is True

question 17

Multiple Choice

Which statement is true?

• A) The larger the standard deviation, the lower the total risk.
• B) The larger the standard deviation, the higher the total risk.
• C) The larger the standard deviation, the more portfolio risk.
• D) The standard deviation is not an indication of total risk.

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Definitions:

Long-Term Note Payable

A loan or debt with a repayment period that extends beyond one year, often used for significant business investments.

Mortgage Payable

A long-term liability representing borrowed funds secured by the pledge of property, to be repaid within a specified period.

Installment Payment

A method of paying for goods or services over a period of time in regular, scheduled payments.

Straight-Line Method

A depreciation method that allocates an equal amount of depreciation each year over the useful life of the asset.