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4vir4ik [10]
3 years ago
9

True or False: Increasing the number of stocks in a portfolio reduces market risk.Consider two stock portfolios. Portfolio B con

sists of 20 different stocks from firms in different industries. Portfolio A consists of 10 different stocks, also from firms in different industries. The return on Portfolio B is likely to be volatile than that of Portfolio A.
Business
1 answer:
nikitadnepr [17]3 years ago
7 0

Answer:

The correct answer is False.

Explanation:

A basic principle of investments is the creation of portfolios (or portfolios) for diversification purposes. At any given time, investors simultaneously hold a set of assets that make up their investment portfolio. A basic principle in finance is that an investor should not place all of his resources in a single asset or in a relatively small number of assets, but in a large number of investment instruments. In this way, the possible bad results in certain assets would be offset by the good results of others. Diversification allows the investor to lower the risk of his portfolio without sacrificing returns or, alternatively, increase the return on his portfolio without increasing his risk. Of course, diversification does not guarantee profits under any circumstances, but it does help to dampen the variability of returns on individual assets.

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Digicon Inc. is a firm with mindshare in the category of digital cameras. With reference to this information, which of the follo
kherson [118]

Answer:

d.The digital cameras manufactured by the firm are seen as the standard for competitors to match.

Explanation:

Mindshare is a term that measures the amount of popularity and consumer awareness in a certain category. To say that Digicon Inc. has a mindshare in the category of digital cameras means that the company sets the bar for the digital cameras market and, therefore, should be seen as the standard that competitors should try to match.

Thus, the answer choice that better fits the description is d.The digital cameras manufactured by the firm are seen as the standard for competitors to match.

3 0
4 years ago
The following data were taken from the records of Menendez Company:
nydimaria [60]

Answer: a. $1,500

Explanation:

Working capital is calculated by deducting current liabilities from current assets. It is meant to show the operating liquidity of a company within a period.

Working capital = Current assets - Current liabilities

= 5,000 - 3,500

= $1,500

3 0
3 years ago
Alex is a member of a corporate sales team who frequently speaks in front of groups as part of sales presentations. He has now b
dybincka [34]

Answer: Alex tells a story about his brother that causes his friends and family in the audience to laugh.

Explanation:

The statement that describes a strategy that Alex could use to deliver a lighter speech will be for Alex to tell a story about his brother that causes his friends and family in the audience to laugh.

It's but proper for Alex to tell an embarrassing joke about his brother. Also, preparing a long statement to be delivered when it's time to toast can make the event boring.

Therefore, the correct option is A.

8 0
3 years ago
First national bank charges 11.5 percent compounded monthly on its business loans. first united bank charges 11.7 percent compou
stich3 [128]

APR=11.5% compounded monthly
EAR=(1+0.115/12)^12-1=0.121259=12.13%
EAR=12.13%

APR=11.7% compounded semi-annually
EAR=(1+0.117/2)^2-1=0.12042225=12.04%
EAR=12.04%
5 0
4 years ago
Why is Apple’s industry so competitive and how could this affect the ethical risks in Apple’s operations?
maw [93]

Answer:

Apple industry is the consumer goods technological sector.

Explanation:

This sector is very competitive because it tends to be very profitable, which means that it attracts a large number of skilled entrepreneurs and wokers who create high quality products that customers demand. This is specially true of the mobile phone sub-sector, with industry giants like Samsung and Huawei being in stiff competition with Apple.

Because of this, Apple faces several ethical risks: for one, it faces the risk of not practicing predatory pricing techniques like dumping in order to drive out competition, because this would be unfair not only to the other firms, but also to the other companies.

Another ethical risks would be more relevant for managers, and that is that managers should avoid to overestimate their ability to increase profits, because this may create false expectations on the board, on stockholders, and on the customers, leading to malinvestment, and other negative eocnomic consequences.

6 0
3 years ago
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