Which of the Following Is NOT a Contributing Factor to the Segmentation

question 14

Multiple Choice

Which of the following is NOT a contributing factor to the segmentation of capital markets?

• A) excessive regulatory control
• B) perceived political risk
• C) anticipated foreign exchange risk
• D) All of the above are contributing factors.

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Definitions:

Risky Asset

An asset that carries a higher degree of risk of loss, but also offers a higher potential return.

Risk-free Asset

An investment with zero risk of financial loss, theoretically providing guaranteed returns, such as government bonds.

Portfolio Betas

Measures the volatility, or systemic risk, of a portfolio of investments relative to the overall market, indicating its sensitivity to market movements.

Greater Than 1.0

This term typically implies a value that exceeds one in magnitude, often used in financial ratios indicating a positive performance or ratio above one.