As Diversification Increases, the Unsystematic Risk of a Portfolio Approaches

question 67

Multiple Choice

As diversification increases, the unsystematic risk of a portfolio approaches

• A) 1.
• B) 0.
• C) infinity.
• D) (n −1) × n.

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Definitions:

Contingency

A future event or circumstance that is possible but cannot be predicted with certainty.

Employee Needs

include the various psychological and physical requirements that must be met to ensure satisfaction and productivity of workers.

Behavioral Approach

A perspective in management and psychology focusing on the effects of individual and group behavior on organizational performance and efficiency.

Systems Approach

A method of problem solving or analysis that views problems as parts of an overall system, rather than focusing on individual components.