In General, When the Correlation Coefficient Between the Returns on Two

question 58

Multiple Choice

In general, when the correlation coefficient between the returns on two securities is , the risk of a portfolio is
The weighted average of the total risk of the two individual securities.

• A)equal to +1.0;equal to
• B)less than +1.0;less than
• C)a and b
• D)none of these

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Definitions:

Cortex

The outer layer of an organ or body structure, especially the cerebral cortex of the brain, which is involved in high-level functions such as consciousness, thought, and memory.

Blind Spot

A specific point in a person's field of vision where they are unable to see, due to the optic disc's location on the retina.

Optic Nerve

A neural pathway that conveys images from the retina to the brain.

Retina

The light-sensitive layer of tissue at the back of the inner eye that converts light images to nerve signals for vision.