1. In general, diversification of assets:

A) will reduce overall risk when there is a high correlation between investment performance of various assets.

B) will reduce overall risk when there is a low correlation between investment performance of various assets.

C) is not available to the smaller, individual investor.

D) all of the above.

2. The mean/standard deviation model:

A) is only useful when there is just one anticipated future cash flow.

B) cannot be used when cash flows are not equal over time.

C) is not useful when cash flows are perfectly correlated.

D) none of the above.