Diversification Reduces the Risk of a Portfolio Because and Some

question 95

Multiple Choice

Diversification reduces the risk of a portfolio because and some of the risks are averaged out of the portfolio.

• A) firms have common risks
• B) share prices are always affected by the market
• C) share prices do not move identically
• D) share prices are unpredictable

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Definitions:

+3 Edema

A classification indicating moderate to severe swelling involving fluid accumulation in the tissues.

Depression

A mental disorder characterized by persistent sadness, loss of interest, and a lack of energy or motivation.

Skin Temperature

A measure of the warmth of the skin surface, influenced by blood circulation and environmental factors.

Dorsum

The upper side or back part of an organ, structure, or body.