Which Statement Is Consistent with the Strategy of Diversification in Stock

question 24

Multiple Choice

Which statement is consistent with the strategy of diversification in stock investment?

• A) Buy all stocks in the stock market.
• B) Pick stocks that you believe are undervalued.
• C) Buy a mutual fund of a broad stock market index.
• D) Buy and sell a stock at the same time.

---

Definitions:

Inhibition Generalizes

A psychological phenomenon where the suppression of a response to a particular stimulus also suppresses responses to similar stimuli.

Peak Shift

The shift in the maximum response, which occurs to a stimulus other than SD and in the stimulus direction opposite that of the SΔ.

Interoceptive Stimulus

A type of stimulus that originates from within the body, such as hunger, thirst, or the sensation of a racing heartbeat.