David Increases the Number of Companies in Which He Holds

question 18

Multiple Choice

David increases the number of companies in which he holds stocks.

• A)This reduces risk's standard deviation and firm-specific risk.
• B)This reduces risk's standard deviation and market risk.
• C)This raises market risk,but lowers firm-specific risk.What happens to overall risk is unclear.
• D)This raises firm-specific risk,but lowers market risk.What happens to overall risk is unclear.

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Definitions:

Eating Binges

Periods of excessive food consumption generally not driven by hunger but emotional factors, often followed by guilt or shame.

Overweight

Having more body weight than is considered normal or healthy for a certain height.

Emotional Problems

Difficulties in managing one's emotions that significantly interfere with daily functioning or wellbeing.

Eating Binges

Episodes of excessive food consumption within a short time period, often accompanied by a sense of loss of control over eating behaviors.