Author Question: If two events are perfectly positively correlated, then A) diversification is not necessary since ... (Read 52 times)

SO00

  • Hero Member
  • *****
  • Posts: 568
If two events are perfectly positively correlated, then
 
  A) diversification is not necessary since there is no risk.
  B) diversification eliminates all risk.
  C) diversification does not reduce risk at all.
  D) diversification only cuts the risk in half.

Question 2

The ability of diversification to reduce risk
 
  A) is greater the more negatively correlated the two events are.
  B) is greater the more positively correlated the two events are.
  C) is greater the more uncorrelated the two events are.
  D) is greater the more risk averse the individual is.


cpetit11

  • Sr. Member
  • ****
  • Posts: 321
Answer to Question 1

C

Answer to Question 2

A



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
 

Did you know?

Cyanide works by making the human body unable to use oxygen.

Did you know?

Bacteria have been found alive in a lake buried one half mile under ice in Antarctica.

Did you know?

People about to have surgery must tell their health care providers about all supplements they take.

Did you know?

When Gabriel Fahrenheit invented the first mercury thermometer, he called "zero degrees" the lowest temperature he was able to attain with a mixture of ice and salt. For the upper point of his scale, he used 96°, which he measured as normal human body temperature (we know it to be 98.6° today because of more accurate thermometers).

Did you know?

The largest baby ever born weighed more than 23 pounds but died just 11 hours after his birth in 1879. The largest surviving baby was born in October 2009 in Sumatra, Indonesia, and weighed an astounding 19.2 pounds at birth.

For a complete list of videos, visit our video library