The Proportion of Money Held as a Safe Asset in an Investor's

question 24

Multiple Choice

The proportion of money held as a safe asset in an investor's portfolio

• A)increases as the need to hedge against inflation becomes greater
• B)may be less important for wealthier investors who can hedge risks through diversification
• C)increases when interest rates increase
• D)is larger for the wealthy than for the poor
• E)should always be at least 50% of the total portfolio

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