As the Number of Stocks in a Person's Portfolio Increases

question 28

Multiple Choice

As the number of stocks in a person's portfolio increases,

• A)the risk of the portfolio increases,as indicated by the increasing value of the standard deviation of the portfolio.
• B)the risk of the portfolio increases,as indicated by the decreasing value of the standard deviation of the portfolio.
• C)the risk of the portfolio decreases,as indicated by the increasing value of the standard deviation of the portfolio.
• D)the risk of the portfolio decreases,as indicated by the decreasing value of the standard deviation of the portfolio.

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Definitions:

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Real estate property leased or rented out to tenants, often as an investment.

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A formula used to determine the amount of tax owed by an individual or business to the government.

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Slope is a measure of the steepness or incline of a line, defined as the ratio of the vertical change to the horizontal change between two points on the line.