Which of the Following Statements Is CORRECT

question 70

Multiple Choice

Which of the following statements is CORRECT?

• A)The higher the correlation between the stocks in a portfolio, the lower the risk inherent in the portfolio.
• B)It is impossible to have a situation where the market risk of a single stock is less than that of a portfolio that includes the stock.
• C)Once a portfolio has about 40 stocks, adding additional stocks will not reduce its risk by even a small amount.
• D)An investor can eliminate virtually all diversifiable risk if he or she holds a very large, well-diversified portfolio of stocks.
• E)An investor can eliminate virtually all market risk if he or she holds a very large and well-diversified portfolio of stocks.

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Definitions:

Alzheimer's Disease

A chronic neurodegenerative disorder characterized by memory loss, cognitive decline, and personality changes, leading to the inability to perform daily activities.

Down Syndrome

A genetic disorder caused by the presence of all or part of a third copy of chromosome 21, associated with physical growth delays and mild to moderate intellectual disability.

Beta-amyloid

A fibrous protein that accumulates abnormally in the brains of patients with Alzheimer's disease, forming plaques that disrupt cell function.

Plaques

Deposits of amyloid protein that accumulate in the extracellular spaces of the cerebral cortex, hippocampus, and other forebrain structures in people with Alzheimer’s disease.