Combining Negatively Correlated Assets Having the Same Expected Return Results

question 150

Multiple Choice

Combining negatively correlated assets having the same expected return results in a portfolio with ________ level of expected return and ________ level of risk.

• A) a higher; a lower
• B) the same; a higher
• C) the same; a lower
• D) a lower; a higher

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Definitions:

Vroom's model

A theoretical model that suggests decision-making and leadership styles should be adapted based on the situation and characteristics of the followers.

Decision Making

The method of selection by recognizing a decision, assembling data, and examining various alternatives.

Goal Clarity

The extent to which the objectives or desired outcomes of a task or project are clearly defined and understood.

Goal-path Clarity

signifies the clear understanding of the objectives to be achieved and the specific methods or steps required to reach those goals.