Which of the Following Statements Is FALSE

question 65

Multiple Choice

Which of the following statements is FALSE?

• A)If the CAPM correctly computes the risk premium,investors would stop investing only when they expected the alpha of an investment strategy to be negative.
• B)If the CAPM correctly computes the risk premium,an investment opportunity with a positive alpha is a positive NPV investment opportunity.
• C)If the CAPM correctly computes the risk premium,investors should flock to invest in positive alpha stocks.
• D)Anyone can implement a momentum trading strategy and therefore generate a positive investment opportunity.

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Definitions:

Play Out

The act of engaging in play or allowing a situation to develop naturally over time without interference.

Fears

Emotions experienced in anticipation of some specific pain or danger, often accompanied by an urge to flee or fight.

Authoritative Parent

A parenting style characterized by high expectations and support, combining responsiveness with clear guidelines and boundaries.

Limits

Boundaries established to define acceptable behaviors or to protect safety and well-being.