Economics Today and Tomorrow, Student Edition
Economics Today and Tomorrow, Student Edition
1st Edition
ISBN: 9780078747663
Author: McGraw-Hill
Publisher: Glencoe/McGraw-Hill School Pub Co
Question
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Chapter 6, Problem 6AA
To determine

To choose: The term that best completes the given sentence.

Expert Solution & Answer
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Answer to Problem 6AA

The best term for the given statement is “overall”.

Explanation of Solution

The diversification is a strategy of managing risk in which mixes of many types of investments are kept in the portfolio. It reduces the risk of the portfolio. This happens because different types of investments have different level of risk and returns due to which loss in one type of investment does not affect another.

So, having different types of investments and savings lowers the overall risk.

Thus, the best term for the given statement is “overall”.

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