If an Investor Does Not Diversify Their Portfolio and Instead

question 21

Multiple Choice

If an investor does not diversify their portfolio and instead puts all of their money in one share, the appropriate measure of security risk for that investor is the ________.

• A)share's standard deviation
• B)variance of the market
• C)share's beta
• D)covariance with the market index

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Definitions:

Aggregate Supply Curve

A visual depiction illustrating the aggregate amount of products and services that suppliers in an economy are prepared and capable of offering across various price points.

Keynes

Concerns John Maynard Keynes, a British economic theorist whose concepts transformed the study and application of macroeconomics as well as state economic policy.

Investment Expenditures

Spending by businesses or individuals on capital assets that are expected to yield benefits or profits over the long term.

Interest Rates

The percentage of a sum of money charged for its use, typically by a bank to borrowers.