What is the principle of diversification and how did it help promote the success of businesses in the 1950s?

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Explanation:

Diversification refers to a risk management strategy whereby different investments are mixed within a portfolio. This is done in order to lower risk and also yield higher long term returns.

During the 1950s, investors chose securities that had minimal relationship with one another so as to reduce their overall risk Some other reasons for diversification in thus era was to maximize shareholder's value and also due to growth.

i thing that the best option is a.they feared it would cause a second economic collapse.

one of the most negatives aspects of the new deal was that it upset the balanced federal budget and led to a huge deficit for the nation while at the same time failed to end increasing unemployment. roosevelt's program, based on keynesian theories of economics, called for massive government spending to stimulate the economy. as he   failed to do this with large tax increases; large sums of money were borrowed to fund new deal programs. when the economy showed some improvement, roosevelt was concerned about inflation, and ordered cuts in government spending. unfortunately, he did so at a time when the new social security tax had cut people's disposable income. businesses were too afraid of spending, and the economy in 1937 was in worse shape than in 1929. at the end of that year, two million people were unemployed.