Which of the Following Is True

Multiple Choice

Which of the following is true?

A) Risk declines at a constant rate with diversification.
B) Risk declines sharply with diversification and then increases as the number of stocks held increases.
C) Risk declines sharply with diversification and then levels out as the number of stocks held increases.
D) Risk declines sharply with the number of shares of a stock held.
E) Risk increases at a constant rate with the number of stocks held.