In Order to Construct a Riskless Portfolio Using Two Risky

question 33

Multiple Choice

In order to construct a riskless portfolio using two risky shares, one would need to find two shares with a correlation coefficient of ________.

• A)1.0
• B)0.5
• C)0
• D)-1.0

Grasp the concept of agency relationships, including how they are formed, operate, and terminate.

Recognize the principles of vicarious liability, including under what circumstances an employer might be liable for the actions of an employee.

Understand the legal implications of misrepresentation in the context of principal-agent relationships.

Identify the different types of principals and agents, and their implications on agency law.

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Definitions:

External-Unstable Attribution

Attributing one's behavior or outcomes to external, transient factors outside one's control.

Internal-Stable Attribution

The tendency to ascribe the cause of a behavior to an internal, unchanging characteristic of the person involved.

Fundamental Attribution Error

The tendency to underestimate the influence of external factors and overestimate the role of internal factors in explaining others' behavior.

External Attribution

The process of attributing the cause of a person's behavior to situational or external factors.