Question: 7- What is a perfectly positive correlation? A. correlation coefficient = 1 B. When Stock A falls, Stock B falls with the same degree C.

7- What is a perfectly positive correlation?
  • A. correlation coefficient = 1
  • B. When Stock A falls, Stock B falls with the same degree
  • C. A correlation in which diversification will not reduce the risk of the portfolio
  • D. All of the above

An example of diversifiable risk is
  • A. market risk
  • B. inflation
  • C. strikes
  • D. all of the above

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