The Risk of a Portfolio

question 69

Multiple Choice

The risk of a portfolio

• A)increases as the number of stocks in the portfolio increases.
• B)is usually measured using a statistic called the standard diversification.
• C)is positively related to the average return of the portfolio.
• D)bears no relationship to the average return of the portfolio.

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Definitions:

Arteriole Walls

The thin-walled blood vessels that regulate blood flow from arteries to capillaries, majorly affecting blood pressure and flow.

Vasodilate

The process of widening blood vessels to increase blood flow.

Blood Pressure

The force exerted by circulating blood upon the walls of blood vessels, often measured for diagnosis since it is related to the heart's pump strength and the elasticity of the arteries.

Vasoconstriction

Narrowing of the diameter of blood vessels.