Diversification Reduces the Risk of a Portfolio Because ________ and Some

question 21

Multiple Choice

Diversification reduces the risk of a portfolio because ________ and some of the risks are averaged out of the portfolio.

• A)stocks do not move identically
• B)stocks have common risks
• C)stocks are unpredictable
• D)stocks are always effected by the market

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Definitions:

Socially Accepted

Behaviors, beliefs, or norms that are widely approved or tolerated by society.

Self-Esteem

Self-esteem is an individual's subjective evaluation of their own worth, encompassing beliefs and emotions regarding self-confidence and self-respect.

Basal Metabolic Rate

The minimum rate of energy expenditure per unit time by endothermic animals at rest.

Energy Expenditure

The total amount of energy used by the body for metabolic processes, physical activity, and maintaining bodily functions.