Ann has a portfolio of 20 average stocks, and Tom has a portfolio of 2 average stocks. Assuming the market is in equilibrium, which of the following statements is CORRECT?
a. The required return on Ann's portfolio will be lower than that on Tom's portfolio because Ann's portfolio will have less total risk.
b. Tom's portfolio will have more diversifiable risk, the same market risk, and thus more total risk than Ann's portfolio, but the required (and expected) returns will be the same on both portfolios.
c. If the two portfolios have the same beta, their required returns will be the same, but Ann's portfolio will have less market risk than Tom's.
d. The expected return on Jane's portfolio must be lower than the expected return on Dick's portfolio because Jane is more diversified.
e. Ann's portfolio will have less diversifiable risk and also less market risk than Tom's portfolio.
b
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Indicate whether the statement is true or false
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Answer the following statement true (T) or false (F)
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A) They will likely hamper your attempts to communicate. B) They are inapplicable to communication. C) They are most likely sufficient to meet every challenge of communication. D) They will be valuable to you for communicating. E) They must all be unlearned if you want to successfully communicate.