The Dow Theory Considers Price Movements in the Dow Jones

question 10

True/False

The Dow Theory considers price movements in the Dow Jones industrial and transportation averages.

---

Definitions:

Linear Relationship

A direct relationship between two variables where a change in one variable is directly proportional to a change in the other.

Reduction

The act of making something smaller or less in amount, degree, or size.

Nondiversifiable Risk

The portion of an investment's risk that cannot be eliminated through diversification, often associated with market-wide risks.

Systematic Risk

The danger that affects the whole market or a part of the market, which cannot be reduced by diversifying investments.