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Multiple Choice

$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$\text { Investiment } A$ $\quad$$\quad$$\quad$$\quad$$\quad$$\text { Investment } B$
$\begin{array}{|l|l|l|l|l|}\hline & \text { Good year } & \text { Bad year } & \text { Good year } & \text { Bad year } \\\hline \text { Probability } & 0.80 & 0.2 & 0.90 & 0.1 \\\hline \text { Pay-off } & 140 & 45 & 110 & 70 \\\hline\end{array}$
-Once a portfolio becomes sufficiently large,the __________ is of greatest importance with respect to risk.

A) variance of individual asset returns
B) variance of assetreturns within the same industry
C) covariance between asset returns within the same industry
D) covariance between asset returns of all assets in the portfolio