Use the Following Information to Answer the Question(s)below

question 24

Multiple Choice

Use the following information to answer the question(s) below. The volatility of the market portfolio is 10%,the expected return on the market is 12%,and the risk-free rate of interest is 4%.
-The expected return on the portfolio of the three stocks is closest to:

• A)10.0%.
• B)11.4%.
• C)11.8%.
• D)12.0%.

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Definitions:

Maker

A maker is the party that issues or creates a financial instrument, such as a check or promissory note, committing themselves to pay a specified amount of money to a designated beneficiary.

Corporate Purchase

A transaction involving the acquisition of assets or stock of a company by another corporation.

Ordinary Holder

An entity or individual that possesses a negotiable instrument but does not necessarily have the rights of a holder in due course.

Rights

Entitlements or privileges granted to individuals, which are protected by law or social convention.