Which of the Following Statements Is Most Correct

question 40

Multiple Choice

Which of the following statements is most correct?

• A)Combining positively correlated assets having the same expected return results in a portfolio with the same level of expected return and a lower level of risk.
• B)Combining negatively correlated assets having the same expected return results in a portfolio with the same level of expected return and a higher level of risk.
• C)Combining positively correlated assets having the same expected return results in a portfolio with a lower level of expected return and a lower level of risk.
• D)Combining negatively correlated assets having the same expected return results in a portfolio with a lower level of expected return and a lower level of risk.
• E)none of the above

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Definitions:

Electronic Negotiable Instruments

Financial instruments that are signed electronically and promise to pay a certain sum of money to the bearer or assigned party.

Money Order

A type of draft that may be purchased from banks, post offices, telegraph companies, and express companies as a substitute for a check.

Draft

A preliminary version of a piece of writing, document, or plan which is subject to further revision or editing.

Big Bank

A big bank refers to a large, multinational banking institution that offers a wide range of financial services, often with significant influence in economic policies and markets.