Missy recently rearranged her portfolio so that it has a higher average return.As a result of this rearranging,Missy
A)raised both firm-specific risk and market risk.
B)raised firm-specific risk,but not market risk.
C)raised market risk,but not firm-specific risk.
D)None of the above is correct.

Question

Quizplus · Accepted Answer

By rearranging her portfolio for a higher average return, Missy likely increased her exposure to firm-specific risk, which is the risk associated with individual investments, while market risk, which affects all investments, remains unchanged.

Missy Recently Rearranged Her Portfolio So That It Has a Higher