It has been argued that diversification eliminates firm-specific risk. Which of the following factors contribute to this notion of diversification eliminating firm-specific risk?

I. Each investment is a smaller percentage of the portfolio, reducing its effect on the overall portfolio.

II. Firm-specific actions will average out to zero.

III. Forming stocks into portfolios reduces the standard deviation of returns for each stock.

a)	I only
b)	I, II, and III
c)	I and II only
d)	I and III only
e)	III only