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
shusha [124]
3 years ago
8

An investor can design a risky portfolio based on two stocks, A and B. Stock A has an expected return of 21% and a standard devi

ation of return of 39%. Stock B has an expected return of 14% and a standard deviation of return of 20%. The correlation coefficient between the returns of A and B is .4. The risk-free rate of return is 5%.
The proportion of the optimal risky portfolio that should be invested in stock B is approximately ________.

A) 29% B) 44% C) 56% D) 71%
Business
1 answer:
irakobra [83]3 years ago
3 0

Answer:

A) 29%

Explanation:

W= (.14-.05)(.39^2)-(.21-.05)(.20)(.39)(.4)

(.14-.05)(.39^2)+(.21-.05)(.20^2) - (.14-.05+.21-.05)(.20)(.39)(.4)

B = 71% A =1-0.71= 29%

σ2rp = (.292)(.392) + (.712)(.202) + 2(.29)(.71)(.39)(.20).4

σ2rp = .045804

σrp = 21.4%

You might be interested in
Laura is a gourmet chef who runs a small catering business in a competitive industry. Laura specializes in making wedding cakes.
mars1129 [50]

Answer:

The correct answer is the letter a. "Make more than 20 wedding cakes a month."

Explanation:

To maximize profit the marginal price of each cake must equal the marginal cost of each cake. The marginal cost is 300 and the marginal price is 5000/20 = 250. The marginal price of each cake (250) is less than the marginal cost of each cake (300), so Laura needs to make more than 20 cakes to increase her revenue and maximize her profit.

5 0
3 years ago
Employer is desperate to hire sales people. Employer conducts initial telephone interviews and offers employment immediately ove
sveticcg [70]

Answer:

A. A claim by the employee will probably be based on promissory estoppel

Explanation:

Promissory estoppel doctrine refers to trying to enforce a promise. In other words, a person that makes a promise is responsible for performing it as long  as:

  1. the promissor made a promise and the promisee acted because of it
  2. the promisee relied on the promise
  3. the promisee suffers a loss due to the unfulfilled promise
7 0
3 years ago
The total cost of Jurislon to be purchased in August is: Multiple Choice $1,839,600 $1,208,700 $1,014,300 $1,017,000
ivann1987 [24]

Answer:  $‭1,014,300‬

Explanation:

The company wants to maintain 20% of the next month's needs as ending inventory.

One Miniwap requires 2.5 kg of Jurision to be made.

Materials purchased is;

= Ending inventory + Materials used - Begining inventory

Ending Inventory;

= 20% of September Jurision

= 20% * 21,300 * 2.5

= 10,650 kg

Materials used

= 2.5 kg * August Miniwaps

= 2.5 * 22,600

= 56,500 kg

Materials Purchased = 10,650 + 56,500 - 10,800

= 56,350‬ kg

Cost of Jurision is $18 per kilo

= 56,350‬ * 18

= $‭1,014,300‬

3 0
3 years ago
Gross domestic product (gdp) is the total market value of all intermediate and final goods and services produced by an economy i
MrMuchimi
A. true
the gross domestic product acts as a quantitative measure of an economy's economic activity on an annual basis

7 0
3 years ago
Why Do Organizations not change in response to environmental pressures?​
Elina [12.6K]

Answer:

It often proves difficult to actually realize the change that you have come up with. Especially when it comes to cultural or behavioral change. We want to show that change is not so much something that you have to get others to join. You have to make your change part of it

3 0
3 years ago
Other questions:
  • Elaborate prefect competition
    15·1 answer
  • Klumper Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the
    10·1 answer
  • To find the number of units that need to be sold in order to break even to generate
    10·1 answer
  • A department had 65 units which were 20% complete in beginning Goods in Process Inventory. During the current period, 77 units w
    6·1 answer
  • On January 1, 2018, the general ledger of Dynamite Fireworks includes the following account balances: Accounts Debit Credit Cash
    9·1 answer
  • A team integrates and tests the Stories on the last day of the Iteration. This has become a pattern for the last three Iteration
    11·1 answer
  • The short-run aggregate supply curve is upsloping because higher price levels lower interest rates and encourage firms to invest
    15·1 answer
  • An off-balance-sheet asset is an item that moves onto the asset side of the balance sheet when a contingent event occurs or at t
    14·1 answer
  • As environmental uncertainties increase, managers must develop techniques and methods for collecting, sorting through, and inter
    11·1 answer
  • What is penetration pricing?
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!