Chapter 8 Practice Questions with a 1. Investinent risk is related to the of actually earning low or negative returns; the greater the chance of low or negative returns, the riskier the investment. 2. A listing of all possible probability assigned to each, is known as a probability 3. Weighting each possiblc ontcome of a distribution by its of occurrence and summing the results give the expected of the distribution. 4. One measure of the tightness of a probability distribution is the standard probability-weighted average deviation from the expected value. 5. Investors who prefer outcomes with a high degree of certainty to those that are less certain are described as being risk 6. Owning a portfolio of securities enables investors to benefit from :a 7. Diversification of a portfolio can result in lower for the same level of retum. 8. Diversification of a portfolio is achieved by selecting securities that are not perfectly correlated with each other. 9. That part of a stock's risk that can be eliminated is known as risk, while the portion that cannot be eliminated is called risk