A Theory Can Be Proven to Be True

question 6

Multiple Choice

A theory can be proven to be true:

• A) If we are certain there are enough observations that fit or confirm the theory
• B) Regardless of how many observations fit or confirm the theory
• C) In some cases, but often there are not enough observations that fit or confirm the theory
• D) Under no circumstances, because we can never be certain that enough observations have been made that fit or confirm the theory

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Definitions:

Well-Organized Markets

Refers to financial markets that are structured efficiently, facilitating the seamless exchange of securities.

Dollar Return

The total gain or loss on an investment expressed in monetary terms, considering both capital gains and dividends or interest.

Shares

Portions of ownership in a corporation or financial entity, shares guarantee an equal share in dividend payouts, contingent on profit declarations.

Dividend

A share of a company's profits distributed to its shareholders, often expressed as a dollar amount per share.