A portfolio consists of all stocks in a market is classified as____________?
Correct answer: A. Market portfolio
- A. Market portfolio
- B. Return portfolio
- C. Correlated portfolio
- D. Diversified portfolio
Explanation
A market portfolio contains all available stocks in the market, weighted according to their market values. It represents the diversified portfolio used as the market benchmark in modern portfolio theory.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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