Two Important Assumptions of Portfolio Theory Are

question 75

Multiple Choice

Two important assumptions of portfolio theory are:

• A)returns from investments are normally distributed and investors seek to minimise transaction costs.
• B)returns from investments are normally distributed and investors are risk averse.
• C)returns on a portfolio are normally distributed and investors are risk averse.
• D)the standard deviation of returns on a portfolio is normally distributed and investors are risk averse.

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Definitions:

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A tool designed to remove staples from documents or other materials.

Staples

Thin pieces of metal used to fasten sheets of paper together, inserted through the sheets and clinched over.

Antiseptic

An agent that will prevent the growth or arrest the development of microorganisms.

Sutures

Stitches used by medical professionals to close cuts or wounds, aiding in the natural healing process of the skin.