PSAT Math Multiple-Choice Question 831: Answer and Explanation

Question: 831

A portfolio analyst wants to determine the relative impact on the performance of the stock portfolio of large-capitalization stocks, mid-capitalization stocks, and small-capitalization stocks. (Capitalization refers to the overall value of the company.) Based on the information given in the charts, how can you best characterize the impact of these different categories of stocks on the portfolio?

• A. There are more large-capitalization stocks than the other two types combined.
• B. There are roughly equivalent amounts of the different stock categories.
• C. The small-capitalization stocks are the largest percent of the portfolio, followed by the mid-capitalization stocks, followed by the large-capitalization stocks.
• D. Not enough information is provided to come to a conclusion.

Correct Answer: D

Explanation:

(D) The tables give information only about the allocation of international and domestic stocks. They do not contain any information about the allocation of large-capitalization stocks, mid-capitalization stocks, and small-capitalization stocks. So not enough information is provided to reach a conclusion.