As Diversification Increases,the Unique Risk of a Portfolio Approaches ____________

question 43

Multiple Choice

As diversification increases,the unique risk of a portfolio approaches ____________.

• A)1
• B)0
• C)infinity
• D)n-1 * n
• E)none of the above

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Definitions:

Economic Expansion

A period characterized by increased business activity and growth in the economy's overall output.

Aggregate Demand

The cumulative request for every type of good and service within an economy across different pricing points, throughout a particular timeframe.

Required Rate

The minimum return that investors expect to receive for investing in a particular asset, taking into account its risk.

Expected Growth Rate

The anticipated rate at which a company, asset, or investment is expected to grow over a certain period.