Which One of the Following Portfolios Might Be Expected to Exhibit

question 9

Multiple Choice

Which one of the following portfolios might be expected to exhibit less specific risk?

• A) Five random stocks; portfolio beta = 0.8
• B) Three random stocks; portfolio beta = 1.2
• C) Ten random stocks; portfolio beta = 1.0
• D) Twelve random stocks; portfolio beta unknown

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Definitions:

Excess Funds

Refers to the amount of money available beyond what is necessary to cover expenses or requirements.

General Fund

The primary operating fund of a government or organization that accounts for all financial resources, except those required to be accounted for in another fund.

Crowdfunding Platform

Online platforms that allow individuals and businesses to fundraise for projects or ventures from a large number of people.

Science-Related Projects

Initiatives or works that are grounded in scientific principles or focus on the exploration of scientific fields.