Which one of the following is the formula that explains the relationship between the expected return on a security and the level of that security's systematic risk?

Select one:

a. expected risk formula

b. capital asset pricing model

c. unsystematic risk equation

d. market performance model

The primary purpose of portfolio diversication is to:

Select one:

a. eliminate asset-specic risk.

b. increase returns and risks.

c. eliminate all risks.

d. eliminate systematic risk.

Which of the following statements is correct?

Select one:

a. Portfolio theory is concerned with maximizing unsystematic risk to enhance returns.

b. Portfolio theory is about elimination of systematic risk.

c. Portfolio theory is concerned with the effect of diversification on portfolio risk.

d. Portfolio theory is about how active portfolio management can enhance returns.