Which one of the following statements is correct?
A) The unexpected return is always negative.
B) The expected return minus the unexpected return is equal to the total return.
C) Over time, the average return is equal to the unexpected return.
D) The expected return includes the surprise portion of news announcements.
E) Over time, the average unexpected return will be zero.

Question

Quizplus · Accepted Answer

The average unexpected return is the deviation from the expected return, and over time, these unexpected returns can balance out and average to zero.

Which One of the Following Statements Is Correct