Which of the Following Statements Is True Regarding a Portfolio's

question 48

Multiple Choice

Which of the following statements is true regarding a portfolio's diversification?

• A) proper diversification can reduce or eliminate systematic risk
• B) the risk-reducing benefits of diversification do not occur meaningfully until at least 16 or more securities have been added to the portfolio
• C) because diversification reduces a portfolio's total risk, it must reduce the portfolio's expected return
• D) as more securities are added to a portfolio, total risk would be expected to fall at a decreasing rate under normal conditions

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Definitions:

Trafficking

Involves the illegal trade of humans for the purposes of forced labor, sexual slavery, or commercial sexual exploitation.

Extreme Poverty

A condition where individuals live below the international poverty line, facing severe deprivation of basic human needs such as food, safe drinking water, sanitation, health, shelter, and education.

Gender Inequality

The unequal treatment or perceptions of individuals based on their gender, leading to disparities in opportunity, resources, and power.

Condone

To overlook, forgive, or disregard an offense without criticism, implying a degree of acceptance or a lack of opposition.