Question

In: Finance

Which one of the following statements is INCORRECT? Group of answer choices An overpriced security's reward-to-risk...

Which one of the following statements is INCORRECT?

Group of answer choices

An overpriced security's reward-to-risk ratio would be lower than the reward-to-risk ratio of the market

The reward-to-risk ratio of the market would be lower than the reward-to-risk ratio of an overpriced security

An under-priced security's reward-to-risk ratio would be higher than the reward-to-risk ratio of the market

The reward-to-risk ratio of the market would be lower than the reward-to-risk ratio of an under-priced security

Solutions

Expert Solution

Option B is the answer as it is incorrect

The reward to risk of the market would be lower than the reward to risk of an overpriced security

Market's reward to risk will be higher

jeff jeffy answered 2 years ago
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