The Standard Deviation of a Portfolio

question 54

Multiple Choice

The standard deviation of a portfolio:

• A) is a weighted average of the standard deviations of the individual securities held in the portfolio.
• B) can never be less than the standard deviation of the most risky security in the portfolio.
• C) must be equal to or greater than the lowest standard deviation of any single security held in the portfolio.
• D) is an arithmetic average of the standard deviations of the individual securities which comprise the portfolio.
• E) can be less than the standard deviation of the least risky security in the portfolio.

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Definitions:

Grassroots Interest Groups

Organizations that form from the bottom up to advocate for specific causes, relying heavily on community member participation.

Homeless

Individuals who lack fixed, regular, and adequate nighttime residence, representing a condition of lacking stable housing.

Interest Group Pluralism

The theory that political power is distributed among a wide array of diverse and competing interest groups.

Class Bias

A prejudice or discrimination based on social class or perceived socioeconomic status.