You Invest $100 in a Risky Asset with an Expected

question 28

Multiple Choice

You invest $100 in a risky asset with an expected rate of return of 0.11 and a standard deviation of 0.21 and a T-bill with a rate of return of 0.045. What percentages of your money must be invested in the risk-free asset and the risky asset, respectively, to form a portfolio with a standard deviation of 0.08?

• A)30.1% and 69.9%
• B)50.5% and 49.50%
• C)60.0% and 40.0%
• D)61.9% and 38.1%

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Definitions:

Job Enlargement

A method of job design that increases the number and variety of tasks that an employee performs, aiming to alleviate boredom and increase job satisfaction.

Individual Interaction

The exchange or communication between people, which can influence social, psychological, and organizational dynamics.

Job Rotation

A workforce management strategy that involves moving employees between different tasks to promote versatility and reduce monotony.

Job Enlargement

An approach to increase the number and variety of tasks that an employee performs to enhance job satisfaction.