Which of the Following Is Not Correct

question 41

Multiple Choice

Which of the following is not correct?

• A)There is a greater reduction in risk by increasing the number of stocks in a portfolio from 1 to 10,than by increasing it from 100 to 120 stocks.
• B)The historical rate of return on stocks has been about 5 percentage points higher than the historical rate of return on bonds.
• C)Stock in an industry that is very sensitive to economic conditions is likely to have a higher average return than stock in an industry that is not so sensitive to economic conditions.
• D)If you had information about a corporation that no one else had,you could earn a very high rate of return.This contradicts the efficient market hypothesis.

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Definitions:

Republican Voters

Individuals who are registered or typically vote for candidates of the Republican Party in the United States.

Population Proportion

The fraction or percentage of a population that possesses a specified characteristic or attribute.

Hypothesis Test

A method in statistics that employs data from a subset to assess a presumption about a parameter of the whole population.

Z Test Statistic

A statistic that measures the number of standard deviations a data point is from the mean, used in hypothesis testing for population means.