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tresset_1 [31]
2 years ago
13

Consider two perfectly negatively correlated risky securities, X and Y. Security X has an expected rate of return of 9% and a st

andard deviation of return of 27%. Y has an expected rate of return of 17% and a standard deviation of return of 39%. What is the weight of security Y in the minimum variance portfolio? Enter your answer rounded to two decimal places. Do not enter % in the answer box. For example, if your answer is 0.12345 or 12.345% then enter as 12.35 in the answer box.
Business
1 answer:
Aneli [31]2 years ago
5 0

Answer:

0.41

Explanation:

The computation of the weight of security Y in the minimum variance portfolio is shown below:-

Weight of security X = Standard deviation of security Y ÷ (Sum of the standard deviation of securities)

= 39% ÷ (39% + 27%)

= 39% ÷ 66%

= 59.01%

Weight of security Y = 1 - Weight of security X

= 1 - 59.01%

= 0.41

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Answer:

B. Controllable costs

Explanation:

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In other words, controllable costs are those costs or expenses that can be influenced by those who are saddled with the responsibilities of incurring them.

5 0
3 years ago
why is government intervention often crucial when dealing with both positive and negative externalities?
Dennis_Churaev [7]

Answer:

Because the government can use her sovereign power to both mitigate negative externalities as well as encourage positive externalities.

Explanation:

A positive externality occurs when the transaction between a producer and end user benefits a third party that did not take art in the process.

A very Good example is Education. There is a third party benefit to the society when we have more educated citizens.

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To deal with both positive and negative externalities, government intervention is very crucial.

Government encourages positive externalities like education by subsidizing the cost of attending a school. They also enact laws that make basic education compulsory.

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6 0
3 years ago
A firm has $600,000 in current assets and $150,000 in current liabilities. Which of the following is correct if it uses cash to
Molodets [167]

Answer:

4) Net working capital will not change.

Explanation:

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Thank you.

4 0
3 years ago
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8 0
3 years ago
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DiKsa [7]

Answer:

$4,000

Explanation:

7 0
3 years ago
Read 2 more answers
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