Which of the Following Statements Is FALSE

question 77

Multiple Choice

Which of the following statements is FALSE?

• A)The variance of a portfolio is equal to the weighted average correlation of each stock within the portfolio.
• B)The variance of a portfolio is equal to the sum of the covariances of the returns of all pairs of stocks in the portfolio multiplied by each of their portfolio weights.
• C)The variance of a portfolio is equal to the weighted average covariances of each stock within the portfolio.
• D)The volatility declines as the number of stocks in a portfolio grows.

---

Definitions:

Socioeconomic Ladder

A conceptual metaphor describing the hierarchical structure of social and economic status, where individuals or groups are ranked based on income, education, and occupation.

Cultural Legacy

Refers to the elements, values, beliefs, and practices that are passed down through generations within a community or society.

Business Acumen

The keenness and quickness in understanding and dealing with a business situation in a manner that is likely to lead to a good outcome.

Non-verbal Expression

A form of communication that does not use words or speech, including gestures, facial expressions, and body language.