Which of the following does not help reduce the risk that people face ?
Correct answer: A. increasing the rate of return within their portfolio
- A. increasing the rate of return within their portfolio
- B. diversifying their portfolio
- C. All of these answers help reduce risk
- D. buying insurance
Explanation
A higher rate of return does not by itself reduce risk and may involve accepting greater risk. Diversification and insurance reduce exposure by spreading or transferring risk.
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