Use the Following Information, Which Describes the Expected Return and Standard

question 95

Multiple Choice

Use the following information, which describes the expected return and standard deviation for three different assets, to answer the following question(s) .

-A negative coefficient of correlation implies that [blank].

• A)on average, returns to such assets are negative
• B)asset returns tend to move in opposite directions
• C)asset returns tend to move in the same directions
• D)there is a perfect relationship between returns earned

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Definitions:

Financial Break-Even

The point where total revenues equal total costs, leading to neither a profit nor a loss.

Accounting Break-Even

The point at which total costs and total revenue are equal, resulting in neither profit nor loss.

Contingency Planning

The process of preparing for possible future situations or changes in operation, especially emergencies or unfavorable circumstances.

Simulation Analysis

involves using mathematical models to replicate a real-world system or process in order to predict outcomes or assess the impact of different variables on that system.