Is It Correct to Claim That Diversification Provides a Benefit

question 69

Multiple Choice

Is it correct to claim that diversification provides a benefit of "risk spreading"?

• A)Yes, in most cases, but it's of little interest or value to shareholders, since they can do that more easily and cheaply themselves
• B)No, usually that is not the case
• C)The answer is not that simplistic
• D)Risk spreading is not always a benefit

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Definitions:

Tryptophan

An essential amino acid that serves as a precursor to serotonin, a neurotransmitter important for mood regulation and sleep.

Narcolepsy

A neurological disorder that affects the control of sleep and wakefulness, characterized by excessive daytime sleepiness and sudden sleep attacks.

Cataplexy

A sudden and temporary loss of muscle tone often triggered by strong emotions, associated with narcolepsy.

Sleepiness

A state of feeling drowsy or tired, often leading to a need or desire to sleep.