Other Things the Same,as the Number of Stocks in a Portfolio

question 116

Multiple Choice

Other things the same,as the number of stocks in a portfolio rises,

• A)risk increases and the standard deviation of the return rises.
• B)risk increases and the standard deviation of the return falls.
• C)risk decreases and the standard deviation of the return rises.
• D)risk decreases and the standard deviation of the return falls.

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Definitions:

Compounded Quarterly

Interest calculation method where the interest earned is added to the principal every quarter, increasing the amount on which subsequent interest is calculated.

Small Claims Court

A court that deals with minor legal disputes involving small monetary amounts.

Compounded Monthly

This is the calculation of interest on an investment or savings where the interest earned each month is added to the principal, thereby increasing the amount on which future interest is calculated.

Fair Rate

A reasonable, equitable interest rate or charge for a loan or service, ensuring fairness to both the provider and the consumer.