An Advantage of International Diversification Is the

question 40

Multiple Choice

An advantage of international diversification is the

• A) reduction in the variability of future cash flows due to domestic business cycles.
• B) increase in the availability of capital.
• C) diversification of political risk.
• D) all of the above.

---

Definitions:

Hindsight Bias

The tendency to believe, after an event has occurred, that one would have predicted or expected the outcome, often referred to as the "I-knew-it-all-along" phenomenon.

Proactive Interference

The phenomenon where previously learned information interferes with the recall of newer information.

Retroactive Interference

A cognitive phenomenon where newly learned information interferes with the recall of previously learned information.

Korsakoff's Syndrome

A chronic memory disorder caused by severe deficiency of thiamine (vitamin B1), most often associated with alcoholism.