A Portfolio of International Stocks in Comparison to Purely U

question 15

Multiple Choice

A portfolio of international stocks in comparison to purely U.S. stocks generally shows

• A) a lower percentage risk for a given number of stocks.
• B) higher percentage risk for a given number of stocks.
• C) the same percentage risk for a given number of stocks.
• D) a lower percentage return for a given number of stocks.

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Definitions:

Liability Account

A liability account is a financial reporting account that is used to record obligations or debts that a company owes to others, such as loans, accounts payable, or mortgages.

Noninterest-Bearing Notes

These are promissory notes issued at a discount to face value that do not pay periodic interest, with the return to the investor being the difference between the purchase price and the face value at maturity.

Discounted Note

A promissory note whose face value has been reduced to reflect the effect of interest that it will earn.