Stock X Has a Standard Deviation of Return of 10

question 30

Multiple Choice

Stock X has a standard deviation of return of 10 percent. Stock Y has a standard deviation of return of 20 percent. The correlation coefficient between the two stocks is 0.5. If you invest 60 percent of your funds in stock X and 40 percent in stock Y, what is the standard deviation of your portfolio?

• A)10.3 percent
• B)21.0 percent
• C)12.2 percent
• D)14.8 percent

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Definitions:

Preconventional Moral Development

A stage in Kohlberg's theory of moral development characterized by an individual's response to moral choices based on personal consequences.

Lying to Customers

The unethical practice of deliberately providing false information to customers about products or services.

Ethical Behavior

Behavior demonstrating a willingness to treat others fairly and that shows one to be honest and trustworthy and that exhibits loyalty to company, associates, and the work for which one is responsible.

Treating Others Fairly

The act of interacting and making decisions in a way that is just, unbiased, and equitable towards all individuals.