In a Particular Year, Aggie Mutual Fund Earned a Return

question 7

Multiple Choice

In a particular year, Aggie Mutual Fund earned a return of 15% by making the following investments in the following asset classes: The return on a bogey portfolio was 10%, calculated as follows:
The total excess return on the Aggie managed portfolio was

• A)1%.
• B)3%.
• C)4%.
• D)5%.

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Definitions:

Profit-Maximizing Output

The optimal production stage for a business, where the highest profit is realized at the point where marginal cost equals marginal revenue.

Total Cost

The complete cost of production, including fixed and variable costs.

Lawn-Mowing

The process of cutting the grass in a garden, lawn, or yard to maintain a desired level of neatness and health.

Profit Per Unit

The amount of income earned from selling one unit of a product after deducting the costs associated with its production and sale.