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The principle of diversification tells us that: a. concentrating an investment in two or three large stocks will eliminate all of the unsystematic risk b.

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The principle of diversification tells us that: a. concentrating an investment in two or three large stocks will eliminate all of the unsystematic risk b. concentrating an investment in three companies all within the same industry will greatly reduce the systematic risk C. spreading an investment across many diverse assets will not lower the total risk d. spreading an investment across many diverse assets will eliminate all of the systematic risk e. spreading an investment across many diverse assets will eliminate some of the total risk Which one of the following is the slope of the security market line? a. capital asset pricing model b. portfolio weight c. beta coefficient d. market risk premium e. risk-free interest rate

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