Diversification of a Portfolio Can

question 57

Multiple Choice

Diversification of a portfolio can

• A) reduce aggregate risk.
• B) eliminate all risk.
• C) increase the standard deviation of the portfolio's return.
• D) reduce idiosyncratic risk.

---

Definitions:

Transportation

The movement of goods from one location to another, which can influence cost, efficiency, and delivery times in the supply chain.

Supply Chain

The network of all entities involved in producing and delivering a product or service, from raw materials to the end consumer, critical for operational efficiency.

Seaports

Maritime facilities that include harbors, docks, and terminals which accommodate sea-going vessels for the purpose of transferring goods and passengers to and from land.

Airports

Complexes that facilitate air transport, including runways, terminals, and support services for passengers and cargo.