Which of the Following Statements Is Most Correct

question 57

Multiple Choice

Which of the following statements is most correct?

• A)A portfolio with a beta of minus 2 has the same degree of risk to the holder, relative to the market, as a portfolio with a beta of plus 2.However the holder of either portfolio could lower his or her exposure by buying some "normal" stocks.
• B)A stock with a beta of −1.0 has zero systematic (or market) risk.
• C)It is possible for a stock to have a positive beta even in situations where the correlation between the returns on it and those on another stock are negative.
• D)Diversifiable risk, which is measured by beta, can be lowered by adding more stocks to a portfolio.
• E)Statements a and c are both correct.

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Definitions:

Organizational Culture

Organizational culture consists of the values, beliefs, behaviors, and norms that characterize an organization and shape its members' actions and interactions.

Performance

The act of carrying out or accomplishing an action, task, or function, often measured against pre-determined standards or objectives.

Corporate Culture

The collective principles, convictions, and habits that form the sociocultural and psychological backdrop of a corporate entity.

Market Domination

When a company or product holds a predominant share of the market in terms of sales or customer loyalty.