The Variation in the Rate of Return One Can Expect

question 222

Multiple Choice

The variation in the rate of return one can expect from ownership of stocks will generally be smaller if

• A) all of the funds are invested in a specific sector of the economy such as the automobile industry.
• B) a diverse set of stocks is held over a lengthy period of time such as 30 or 40 years.
• C) all of the funds are invested in a single stock.
• D) the funds are invested for a relatively short period of time.

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Definitions:

Presentation

The act of showing or displaying information or a product to an audience in a structured manner for understanding or consumption.

Ad

Short for advertisement, a promotional message or material designed to attract interest in a product, service, or event.

Permanent Change

A lasting transformation that alters the state or condition of something or someone in a significant way.

Learning

The acquisition of knowledge or skills through study, experience, or teaching, which leads to a change in behavior or understanding.