In Some Respects, Internationally Diversified Portfolios Are Different from a Domestic

question 53

Multiple Choice

In some respects, internationally diversified portfolios are different from a domestic portfolio because:

• A) investors may also acquire foreign exchange risk.
• B) international portfolio diversification increases expected return but does not decrease risk.
• C) investors must leave the country to acquire foreign securities.
• D) all of the above

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Definitions:

Extended Period

A length of time that is longer than usual or expected.

Primary Group

A small social group characterized by close, personal, and enduring relationships, which significantly influence the attitudes and ideals of those involved.

Concert Audience

The group of people who attend and watch a musical performance at a concert venue.

Secondary Group

A large and impersonal social group whose members pursue a specific goal or activity but typically have a detached and superficial relationship with one another.