Which of the following statement is incorrect? O The diversification increases risk because we are combining two assets that have returns that are negatively correlated (r= -1.0). O Most investors avoid risk if they can, unless they are compensated for accepting risk. The closer the correlation coefficient is to +1.0, the more the two variables will tend to move in the same direction with each other at the same time. O Most of the answers are correct. Portfolios with betas higher than 1.0 are relatively more risky than the market. Question 23 1 pts Which of the following statement is correct? O With an amortized loan, after the last payment is made, all the interest and principal on the loan have been paid. Interest on interest is the interest earned only on the original principal amount invested O Zero interest rate indicates that money has time value. All the answers are incorrect. O Annuities in which the cash flows occur at the end of each of the unspecified time periods are known as annuities due