Which of the Following Is Most Likely to Occur as You

question 74

Multiple Choice

Which of the following is most likely to occur as you add randomly selected stocks to your portfolio, which currently consists of 3 average stocksσ

• A) the expected return of your portfolio is likely to decline.
• B) the diversifiable risk will remain the same, but the market risk will likely decline.
• C) both the diversifiable risk and the market risk of your portfolio are likely to decline.
• D) the total risk of your portfolio should decline, and as a result, the expected rate of return on the portfolio should also decline.
• E) the diversifiable risk of your portfolio will likely decline, but the expected market risk should not change.

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Definitions:

Florida

A southeastern U.S. state known for its beaches, theme parks, and as a popular retirement destination.

German Immigrants

People originating from Germany who migrated to other countries, significantly influencing the cultural and societal landscapes of those nations, particularly the United States.

Assimilated

The process by which individuals or groups of differing ethnic heritage are absorbed and integrated into the dominant culture of a society.

Established Religion

Refers to a religion given official status and support by a government, making it the nation's or state's recognized faith.