Which of the Following Statements Is FALSE

question 40

Multiple Choice

Which of the following statements is FALSE?

• A)Graphically,the efficient portfolios are those on the northeast edge of the set of possible portfolios,an area which we call the efficient frontier.
• B)To arrive at the best possible set of risk and return opportunities,we should keep adding stocks until all investment opportunities are represented.
• C)We say a portfolio is short those stocks that have negative portfolio weights.
• D)Adding new investment opportunities allows for greater diversification and improves the efficient frontier.

---

Definitions:

Reasonable Care

A legal standard requiring individuals or organizations to act with the level of caution and vigilance that a prudent person would under similar circumstances, to prevent harm to others.

Scienter

Intent or knowledge.

Innocent Misrepresentation

A false statement about a fact material to an agreement that the person who made the statement believed to be true.

Mutual Mistake

The result of an error by both parties about a material fact, that is, one that is important in the context of a particular contract.