Concepts Are Ideas That Represent

question 66

Multiple Choice

Concepts are ideas that represent:

• A)a class or category of objects,events,or activities.
• B)mental images of ideas,words,and events.
• C)ideas formed as a result of our experiences in the world.
• D)theories and thoughts about the world.

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Definitions:

Diversification

Spreading a portfolio over many investments to avoid excessive exposure to any one source of risk.

Portfolio

A collection of financial investments like stocks, bonds, commodities, cash, and cash equivalents, including mutual funds and ETFs.

Unique Risk

Nonmarket or firm-specific risk factors that can be eliminated by diversification. Also called firm-specific risk, nonsystematic risk, or diversifiable risk.

Diversification

Diversification is an investment strategy that aims to reduce risk by allocating investments among various financial instruments, industries, geographic locations, or other categories.