The wider the dispersion of returns on a stock,the:
A) lower the expected rate of return.
B) higher the standard deviation.
C) lower the real rate of return.
D) lower the variance.

Question

Quizplus · Accepted Answer

The wider the dispersion of returns on a stock, the higher the standard deviation. This means that there is more volatility in the returns, indicating a higher degree of risk. A higher standard deviation also implies a greater range of potential outcomes, making it more difficult to predict future returns.

The Wider the Dispersion of Returns on a Stock,the