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When Bonds Are Initially Added to an All- Equity Portfolio

Question 40

Multiple Choice

When bonds are initially added to an all- equity portfolio the


A) rate of return is not impacted but the level of risk is lowered.
B) rate of return on the portfolio is impacted more than the level of risk.
C) level of risk and the rate of return are equally impacted.
D) level of risk of the portfolio is impacted more than the rate of return.

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