You Have Developed the Following Data on Three Shares

question 21

Multiple Choice

You have developed the following data on three shares: If you are a risk minimiser, you should choose Share __________ if it is to be held in isolation and Share __________ if it is to be held as part of a well-diversified portfolio.

• A) A; A
• B) A; B
• C) B; A
• D) C; A
• E) C; B

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Definitions:

Raw Materials

The basic materials from which products are manufactured or made, typically used in the early stages of the production process.

On Account

Refers to purchases made or services rendered on a credit basis, implying that payment will be made at a future date.

Raw Materials Inventory

Stocks of basic materials that are used in the production process before undergoing manufacturing.

Work-in-Process Inventory

This refers to the goods that are in the middle of the manufacturing process but are not yet completed.