Which of the Following Statements Is FALSE

question 6

Multiple Choice

Which of the following statements is FALSE?

• A) Because all investors should hold risky securities in the same proportions as the efficient portfolio, their combined portfolio will also reflect the same proportions as the efficient portfolio.
• B) The Capital Asset Pricing Model (CAPM) assumptions hold that the return on any portfolio is the combination of the risk-free rate of return plus a risk premium proportional to the amount of systematic risk in the investment.
• C) Graphically, when the tangent line goes through the market portfolio, it is called the security market line (SML).
• D) A portfolio's risk premium and volatility are determined by the fraction that is invested in the market.

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Definitions:

Social Inequality

The existence of unequal opportunities and rewards for different social positions or statuses within a group or society.

Conflict Theory

A sociological perspective that sees social life as a competition, focusing on the struggle for resources, power, and inequality.

Socialization

The process by which individuals learn and adopt the norms, values, behaviors, and social skills appropriate to their society.

Socialization

The process through which individuals learn and internalize the norms, values, and behaviors appropriate to their society.