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Figure 19.3.1 -Refer to Figure 19.3.1 Above. in Equilibrium on the Perceived

Question 78

Multiple Choice

$Figure 19.3.1 -Refer to Figure 19.3.1 above. In equilibrium on the perceived budget line, the investor: A) reduces the purchase of stocks, but also reduces the risk in her portfolio. B) reduces the purchase of stocks, but increases the risk in her portfolio. C) makes the fraction of stocks in her portfolio larger than is optimal. D) maintains the same fraction of stocks in her portfolio but reduces perceived risk.$ Figure 19.3.1
-Refer to Figure 19.3.1 above. In equilibrium on the perceived budget line, the investor:

A) reduces the purchase of stocks, but also reduces the risk in her portfolio.
B) reduces the purchase of stocks, but increases the risk in her portfolio.
C) makes the fraction of stocks in her portfolio larger than is optimal.
D) maintains the same fraction of stocks in her portfolio but reduces perceived risk.

Correct Answer: