Use the Following Information to Answer the Question(s)below

question 81

Multiple Choice

Use the following information to answer the question(s) below.
-Which of the following statements is FALSE?

• A)Securities that tend to move more than the market have betas lower than 0.
• B)Securities whose returns tend to move in tandem with the market on average have a beta of 1.
• C)Beta corresponds to the slope of the best fitting line in the plot of the securities excess returns versus the market excess return.
• D)The statistical technique that identifies the bets-fitting line through a set of points is called linear regression.

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Definitions:

Affect-as-information Hypothesis

A theory suggesting that people use their current emotions to make decisions and judgments in the absence of more objective information.

Affective Forecasting

Predicting how one will feel in the future after experiencing an event or making a decision.

Financial Decisions

Choices made regarding the management, investment, and expenditure of money.

Selling Price

The amount for which a product or service is sold to the customer.