Which of the Following Will Tend to Result in the Least

question 281

Multiple Choice

Which of the following will tend to result in the least variation in the expected real rate of return from the ownership of stocks?

• A) ownership of a single stock for a short period of time
• B) ownership of a single stock over a lengthy period of time
• C) ownership of stocks from a specific sector (for example, the automobile industry) over a lengthy period of time
• D) ownership of a diverse set of stocks (the Standard & Poor's 500, for example) over a lengthy period of time

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Definitions:

Manager

A person responsible for controlling or administering an organization or group of staff.

Centralisation

The organizational structure where decision-making authority is concentrated at the top levels of management, often resulting in a hierarchy of power.

Decentralisation

Decentralisation is the dispersion of authority to make decisions throughout all levels of the organisation.

Managerial Advice

Guidance or recommendations provided by someone in a supervisory role, intended to improve an individual's or team's performance and decision-making.