-If You Were to Create a Portfolio Designed to Reduce

question 25

Multiple Choice

$$\begin{array}{l}\text { Expected Return (\%) }\\\begin{array} { c c c c } \text { Year } & \text { Asset A } & \text { Asset B } & \text { Asset C } \\\hline 1 & 6 & 8 & 6 \\2 & 7 & 7 & 7 \\3 & 8 & 6 & 8\end{array}\end{array}$$
-If you were to create a portfolio designed to reduce risk by investing equal proportions in each of two different assets, which portfolio would you recommend?

• A) Assets A and C
• B) Assets A and B
• C) none of the available combinations
• D) cannot be determined

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Definitions:

Formal Authority

The power granted to an individual due to their position or role within an organization, enabling them to make decisions and enforce rules.

Participative Leadership

A leadership style in which the leader involves team members in decision-making processes and goal setting, fostering a sense of ownership and collaboration.

Warren Bennis

was a pioneering leadership scholar and author who contributed significantly to the study of leadership, emphasizing the importance of character, creativity, and adaptive capacity in leaders.

Philip Slater

was an American sociologist and playwright known for his work on social structure and dynamics, particularly in relation to modern American society.