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In investment analysis, the security market line does not Select one: O a. identify the optimal portfolio for the investor O b. indicate the relationship between risk and return O c. relate the market return and beta to a stock's return O d. use beta coefficients as a measure of risk According to Charles Ellis Winning the Loser's Game, the most important decision to be made in when establishing an investment strategy is: Select one: O a. Defining a long-term investment policy that achieves true investment objectives. O b. Establishing a system that makes use of market timing to beat the market in the long-term, O c. Selecting specific stocks or groups of stocks and then trading stocks within those groupings until investment goals are met. O d. Using advanced statistical models to select trades and engaging in active trading until investment goals are met. O e Relying on blind luck through the random selection of stocks and industries. A firm's statement of cash flows is useful because it tells analysts Select one: O a. what the accounting profit or loss is. O b. how cash was created. O c. the actual profit or loss. O d. the actual value of assets and liabilities, O e. the source and use of net income. Which of the following provides an illustrative example of changes in accounting principles? n Select one: O a. A change in earnings per share, due to an increase in the number of shares of common stock. O b. A change in income, due to a change for post-retirement benefits. O c. A change in earnings before taxes, because of a change in internal rates on debt. O d. All of the above. O e. None of the above. When a firm repurchases shares of its own stock, 3.0 ion Select one: a. the earnings per share will rise. b. the dividends paid out in total will decline. O c. the earnings per share growth rate will rise. O d. All of the above will happen. O e. None of the above will happen

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