You Would Get the Greatest Amount of Diversification If Two

question 17

Multiple Choice

You would get the greatest amount of diversification if two securities are

• A) positively correlated
• B) negatively correlated
• C) notcorrelated
• D) perfectly correlated

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Definitions:

FIFO

First-In, First-Out, an inventory valuation method where goods purchased first are sold first.

Weighted Average

A calculation that takes into account the varying degrees of importance of the numbers in a data set.

Net Realizable Value

The estimated selling price of goods minus the costs of their sale or disposal.

Lower of Cost

An inventory valuation method requiring inventory to be recorded at the lower of its historical cost or current market value.