Which of the Following Statements Is FALSE

question 81

Multiple Choice

Which of the following statements is FALSE?

• A)Because diversification improves with the number of stocks held in a portfolio,an efficient portfolio should be a large portfolio containing many different stocks.
• B)The beta of a security is the sensitivity of the security's return to the return of the overall market.
• C)An efficient portfolio cannot be diversified further.That is,there is no way to reduce the risk of the portfolio without lowering its expected return.
• D)We call a portfolio that contains only unsystematic risk an efficient portfolio.

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Definitions:

Journalize Transactions

The process of recording financial transactions in a company's journal, marking the first step in the accounting cycle.

Credit Card Sales

Transactions where customers purchase goods or services using a credit card as the payment method.

Service Charge Fee

A fee charged by a bank or financial institution for processing transactions or providing a specific service.

Finance Charges

The cost of borrowing money, including interest and other fees.