David Increases the Number of Companies in Which He Holds

Multiple Choice

David increases the number of companies in which he holds stocks.

A) This reduces risk's standard deviation and firm-specific risk.
B) This reduces risk's standard deviation and market risk.
C) This raises market risk,but lowers firm-specific risk.What happens to overall risk is unclear.
D) This raises firm-specific risk,but lowers market risk.What happens to overall risk is unclear.