Which One of the Following Statements Is Correct

question 27

Multiple Choice

Which one of the following statements is correct?

• A)A portfolio variance is a weighted average of the variances of the individual securities which comprise the portfolio.
• B)A portfolio variance is dependent upon the portfolio's asset allocation.
• C)A portfolio variance is unaffected by the correlations between the individual securities held in the portfolio.
• D)The portfolio variance must be greater than the lowest variance of any of the securities held in the portfolio.
• E)The portfolio variance must be less than the lowest variance of any of the securities held in the portfolio.

Understand the concept of purchasing assets and its impact on the accounting equation.

Distinguish between different methods of asset acquisition (cash vs. credit).

Recognize the effect of business transactions on total assets.

Understand how liabilities affect the accounting equation.

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Definitions:

Emotional Content

The emotional significance or impact of a message, situation, or experience.

Rambling

Speaking or writing at length in a confused or inconsequential way without clear direction or point.

Incongruent Responses

Responses that do not align or are inconsistent with the expected outcome or previous statements.

Satisfaction

A feeling of fulfillment or contentment regarding a particular outcome or experience.