As Diversification Increases, the Unsystematic Risk of a Portfolio Approaches

question 42

Multiple Choice

As diversification increases, the unsystematic risk of a portfolio approaches

• A)1.
• B)0.
• C)infinity.
• D)(n - 1) * n.

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Definitions:

Fear of Danger

A basic emotional state characterized by the anticipation or awareness of potential harm or threats.

Contamination

The presence of an unwanted substance or microorganism in another substance, place, or physical body, leading to potential harm.

Prevalence Rate

The proportion of a population found to have a particular condition at a specific time.

Unipolar Depression

A major depressive disorder characterized by persistent and intense feelings of sadness or despair without the episodes of mania that occur in bipolar disorder.