Diversification Is Most Effective When Security Returns Are ________

question 89

Multiple Choice

Diversification is most effective when security returns are ________.

• A) high
• B) negatively correlated
• C) positively correlated
• D) uncorrelated

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Definitions:

Implied Authorization

An understanding that an agent has the approval to perform acts that are reasonably necessary to accomplish the purpose of an agency.

Offeror

The person or entity who makes a proposal or offer, especially in a contractual context.

Objective Standards

Criteria or benchmarks that are not influenced by personal feelings, interpretations, or prejudice; based on facts.

Subjective Standards

Criteria or guidelines that are based on personal opinions, feelings, or tastes, rather than objective, measurable indicators.