expected return
portfolio
systematic
unsystematic
The principle of diversification tells us that:
beta
security market line
market risk premium
total
I, II, III, and IV
I, II, and III only
If a stock portfolio is well diversified, then the portfolio variance:
may be less than the variance of the least risky stock in the portfolio.
Which one of the following is an example of systematic risk?
Unsystematic risk:
Which one of the following is an example of unsystematic risk?
I and IV only
I and III only
The primary purpose of portfolio diversification is to:
eliminate asset-specific risk.
a decrease in the portfolio standard deviation
10
expected rate of return
II and IV only
The intercept point of the security market line is the rate of return which corresponds to:
the risk-free rate.
A stock with an actual return that lies above the security market line has:
risk premium.
risk premium
I, III, and IV only
expected return
portfolio
systematic
unsystematic
The principle of diversification tells us that:
beta
security market line
market risk premium
total
I, II, III, and IV
I, II, and III only
If a stock portfolio is well diversified, then the portfolio variance:
may be less than the variance of the least risky stock in the portfolio.
Which one of the following is an example of systematic risk?
Unsystematic risk:
Which one of the following is an example of unsystematic risk?
I and IV only
I and III only
The primary purpose of portfolio diversification is to:
eliminate asset-specific risk.
a decrease in the portfolio standard deviation
10
expected rate of return
II and IV only
The intercept point of the security market line is the rate of return which corresponds to:
the risk-free rate.
A stock with an actual return that lies above the security market line has:
risk premium.
risk premium
I, III, and IV only