1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Alinara [238K]
3 years ago
10

You invest 70% of your money on a stock with expected return of 15% and standard deviation of 22%. The rest of your money is inv

ested in T-bills with expected return of 7%. The expected return and standard deviation of your complete portfolio are a. 12.6% and 15.4%. b. 15% and 22%. c. 7% and 0%. d. 11% and 11%. e. None of the above option is correct.
Business
1 answer:
Ahat [919]3 years ago
4 0

Answer:

The portfolio return is 12.6% and the portfolio SD is 15.4%. Thus, option a is the correct answer.

Explanation:

The expected return of a portfolio is the weighted average of the individual stock returns that form up the portfolio. Thus, the expected return for a two stock portfolio is,

Return of Portfolio =  wA * rA  +  wB * rB

Where,

  • w represents the weight of each stock in the portfolio
  • r represents the return of each stock

Portfolio return = 0.7 * 0.15  +  0.3 * 0.07  =  0.126  or 12.6%

The standard deviation of a two stock portfolio containing one risky and one risk free asset is the weight of risky asset in the portfolio multiplied by the standard deviation of the risky asset. The risk free asset has zero standard deviation.

Standard deviation of such a portfolio is,

Portfolio SD = w of risky asset * SD of risky asset

Portfolio SD = 0.7 * 0.22  

Portfolio SD = 0.154 or 15.4%

You might be interested in
What is the term for when businesses produce goods and services that consumers do not want​
tino4ka555 [31]

Answer:

Productive (technical) inefficiency.

Explanation:

A market failure can be defined as a situation in which the market fails to produce an efficient level of productivity or output that is required to meet consumer demand.

This ultimately implies that, a market failure arises when there is inefficiency in the distribution or allocation of goods and services in a free market.

In Economics, there are two types of inefficiency associated with the production of goods and services, these includes;

1. Allocative inefficiency: it occurs when businesses do not maximise output from the given inputs. Thus, it arises when businesses fail to increase the level of their production or productivity from a number of given inputs.

In conclusion, allocative inefficiency typically occurs when the price of a good or service isn't equal to its marginal cost i.e P ≠ MC.

2. Productive (technical) inefficiency: it occurs when businesses produce goods and services that consumers do not want.​ This is typically as a result of the incorrect and inefficient allocation of scarce resources by a business firm or entity.

4 0
3 years ago
If Bangladesh is open to international trade in oranges without any restrictions, it will ___________ tons of oranges. Suppose t
azamat

Question Completion:

Assume that the price per ton of oranges in the international market is $810 and equilibrium is established at the price of $900 for 120 tons.

Answer:

If Bangladesh is open to international trade in oranges without any restrictions, it will ____import____ tons of oranges. Suppose the Bangladeshi government wants to reduce imports to exactly 120 tons of oranges to help domestic producers. A tariff of ____$90____ per ton will achieve this.  A tariff set at this level would raise $___10,800______ in revenue for the Bangladeshi government.

Explanation:

A tariff of $90 per ton will raise the price of a ton of oranges to $900 ($810 per ton as indicated on the question).  When the price is raised to $900 in the domestic market, the quantity demanded will equalize with the quantity supplied at 120 tons.

5 0
3 years ago
How were land mines used in the civil war?
NARA [144]
As trapes so when the enemy would attack the planted explosives would go off and kill multiple people

8 0
3 years ago
generally require more technical skills and fewer conceptual skills. a. executive managers b. first-line managers c. middle mana
Volgvan

First-line managers generally require more technical skills and fewer conceptual skills.

Conceptual skills are vital for top managers, less critical for mid-degree managers and no longer required for first-stage managers. As we move from the bottom of the managerial hierarchy to the pinnacle, the significance of these capabilities will upward thrust. Professional first-line managers can pay attention, talk, and write truely and continually, speaking for maximum effect with people at all degrees inside the organization, including team members, superiors, friends, and others. it is specifically important to correctly speak desires and expectations.technical abilities are the most vital for lower level managers because the managers surpervise the workers who produce products or serve clients. Group leaders and first-line managers want technical understanding and competencies to train new employees and help employees remedy problems. Pinnacle managers need sturdy conceptual abilities, whilst the ones at midlevels need top interpersonal abilities and those at lower stages want technical abilities. All managers want robust communication, selection-making, and time-management skills.

Because of this first-line managers need to be skillful hassle solvers who recognize the way to quick expand alternative plans and enforce them within teams. First-line managers have to remain agile and flexible when shifts unavoidably occur within an organizational structure.

Learn more about First-line manager here:-

brainly.com/question/14249035

#SPJ4

3 0
2 years ago
Sorry i accidently did this. do not know how to work
san4es73 [151]

Answer:

sorry for u

Explanation:

will they barn u

6 0
2 years ago
Read 2 more answers
Other questions:
  • A detailed list of questions submitted to external vendors to determine how well they meet the organization's specific requireme
    12·1 answer
  • What can the government of a relatively poor country do to promote economic prosperity? check all that apply. encourage transmis
    12·2 answers
  • Alyeska Services Company, a division of a major oil company, provides various services to the operators of the North Slope oil f
    11·1 answer
  • Blue Seas Cruiseline offers two types of dinner​ cruises: Regular and Executive. The contribution margin per ticket sold is​ $30
    6·2 answers
  • Cingular​ Cell, Inc. charges its customers a high contract termination fee if they cancel their cell phone contract before the e
    12·1 answer
  • Mary and Sam are the only two growers who provide organically grown corn to a local grocery store. They know that if they cooper
    10·1 answer
  • One of the biggest advantages of a wiki is that it __________. a. allows companies to conduct market research b. reduces the con
    8·1 answer
  • After Juan wrote down the week's tasks, schoolwork, and after-school activities in his assignment notebook, he highlighted all t
    11·2 answers
  • The main problem with the fee-for-service model is that doctors have an incentive to:
    9·1 answer
  • At January 1, 2016, Waterway Industries has beginning inventory of 1500 surfboards. Waterway estimates it will sell 5000 units d
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!