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For a Diversified Portfolio Including a Large Number of Stocks

Question 36

Multiple Choice

For a diversified portfolio including a large number of stocks,:


A) the weighted average expected return goes to zero.
B) the weighted average of the betas goes to zero.
C) the weighted average of the unsystematic risk goes to zero.
D) the return of the portfolio goes to zero.
E) the return on the portfolio equals the risk-free rate.

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