A Portfolio Can Reduce Risk When Its

question 9

Multiple Choice

A portfolio can reduce risk when its

• A) investments do not move in tandem.
• B) investments move in tandem.
• C) returns of individual investments are similar.
• D) investments are from similar industries.

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Definitions:

Wood

A hard, fibrous material made of the trunks and branches of trees, used for construction, making furniture, and other purposes.

Production Function

An equation or model that describes the relationship between the inputs used in production and the output of goods or services.

Plastic

A wide range of synthetic or semi-synthetic materials that use polymers as a main ingredient and are malleable, making them suitable for various applications.

Wood

A natural, fibrous material derived from trees, widely used for construction, manufacturing, and fuel.