The Incremental Risk to a Portfolio from Adding Another Stock

question 53

Multiple Choice

The incremental risk to a portfolio from adding another stock:

• A) is always greater than the average portfolio risk.
• B) is always less than the average portfolio risk.
• C) is always positive.
• D) may be either positive or negative.

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Definitions:

Service Department Cost

Expenses associated with the functions that support the production or selling activities of a business, such as maintenance, cleaning, and security services.

Macro Division

A segment within a company or industry that focuses on the broad, overall management and strategies rather than individual components or products.

ABC Corporation

A placeholder name often used to represent a generic, hypothetical company.

Service Department Cost

Costs associated with departments that do not directly produce goods but provide essential support services within a company.