Which of the Following Is NOT a Characteristic of Standardized

question 1

Multiple Choice

Which of the following is NOT a characteristic of standardized tests?

• A) Data analysis is easy.
• B) They have strong psychometric properties.
• C) Test scores are objective and meaningful without interpretation.
• D) Reference group data may be compiled.

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Definitions:

Full Diversification

The process of spreading investments across various assets to reduce exposure to risk from any single asset.

Nonsystematic Risk

The risk associated with an individual investment or a small group of investments, which can be mitigated through diversification.

Treynor-Black Model

An optimization tool used by portfolio managers to balance the trade-off between risk and return by combining actively selected securities with a passively managed market portfolio.

Nonsystematic Risk

The risk associated with a specific issuer of a security, industry, or sector, which can be mitigated through diversification.