In the Past Low Correlations of Foreign Stock Price Changes

question 44

Multiple Choice

In the past low correlations of foreign stock price changes with U.S. stock price changes have

• A) discouraged more global diversification of U.S. portfolios
• B) encouraged more foreign diversification in U.S. portfolios
• C) encourage more foreign diversification of U.S. portfolios
• D) given little advantage to a globally diversified U.S. portfolio

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Definitions:

AFC

Average Fixed Cost represents the fixed expenses of a firm divided by the quantity of output produced.

Variable Inputs

Inputs or resources whose usage level can be changed in the short term to match the level of production output.

Property Resources

Physical and intangible entities that generate economic value owned by individuals or companies.

Labor

The human effort, including both physical and mental work, used in the production of goods and services.