Which of the Following Statements Is True

question 32

Multiple Choice

Which of the following statements is true?

• A) A stock with a beta less than zero has no exposure to systematic risk.
• B) A stock with a beta greater than 1.0 has lower nondiversifiable risk than a stock with a beta of 1.0.
• C) A stock with a beta less than 1.0 has lower nondiversifiable risk than a stock with a beta of 1.0.
• D) A stock with a beta less than 1.0 has higher nondiversifiable risk than a stock with a beta of 1.0.

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Definitions:

Nonrejection Region

The range of values in hypothesis testing for which the null hypothesis is not rejected, indicating no statistical significance difference.

Z.TEST

A statistical test used to determine whether there is a significant difference between a sample mean and a known population mean, assuming a normal distribution.

P-Value

In statistical hypothesis testing, the probability that the observed data could have occurred by random chance if the null hypothesis is true.

Excel Function

A prebuilt formula in Microsoft Excel that performs calculations, manipulates data, or performs other specific tasks.