The Standard Deviation of a Portfolio of Risky Securities Is

question 19

Multiple Choice

The standard deviation of a portfolio of risky securities is

• A)the square root of the weighted sum of the securities' variances.
• B)the square root of the sum of the securities' variances.
• C)the square root of the weighted sum of the securities' variances and covariances.
• D)the square root of the sum of the securities' covariances.
• E)none of the above.

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Definitions:

Future Loss

The potential for an individual or entity to experience a decrease in value or benefit in the future.

Normal Depression

A temporary state of sadness or low mood that is considered within the range of normal human emotional responses.

Adaptive Function

Refers to the psychological characteristics and behaviors that effectively respond to environmental challenges, therefore contributing to an individual's survival and reproductive fitness.

Biological Perspective

An approach in psychology focusing on the biological factors that influence behavior, thoughts, and emotions.