As You Add More Stocks to a Portfolio

question 96

Multiple Choice

As you add more stocks to a portfolio:

• A) specific risk at first falls, then rises.
• B) market risk is increasingly diversified away.
• C) specific risk is increasingly diversified away.
• D) market risk declines but specific risk rises.

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Definitions:

Logrolling

The process of exchanging favors, especially in politics by reciprocal voting for each other's proposed legislation.

Social Engineering

Social engineering involves manipulating individuals into divulging confidential or personal information for fraudulent purposes.

Grandstanding

Engaging in behavior or making statements intended to attract positive attention and impress others.

Marginal Benefit

The added contentment or utility derived from utilizing or producing an extra item of a good or service.