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If There Is a Positive Correlation Between the Value of an Asset

Question 17

Multiple Choice

If there is a positive correlation between the value of an asset that is invested in and the value of the currency in which that value is represented:


A) the covariance risk increases.
B) the risk associated with the investment is reduced.
C) the economic risk is increased.
D) the economic risk and the default risk move in opposite directions and reduce overall risk.

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