Asset Allocation May Involve

question 53

Multiple Choice

Asset allocation may involve

• A)the decision as to the allocation between a risk-free asset and a risky asset.
• B)the decision as to the allocation among different risky assets.
• C)considerable security analysis.
• D)the decision as to the allocation between a risk-free asset and a risky asset and the decision as to the allocation among different risky assets.

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Definitions:

Technical Analysis

A method of evaluating securities by analyzing statistics generated by market activity, such as past prices and volume.

Government Spending

Expenditures by the government on goods and services, including infrastructure projects, welfare, and salaries for government workers.

Demand Shock

A sudden event that significantly alters demand for goods or services, either positively or negatively, in an economy.

Supply Shock

An unexpected event that suddenly changes the supply of a product or commodity, leading to sudden price changes and/or shifts in the market.