A Portfolio Consisting of Four Shares Is Expected to Produce

question 44

Multiple Choice

A portfolio consisting of four shares is expected to produce returns of 9%, 11%, 3% and 17%, respectively, over the next four years. What is the standard deviation of these expected returns?

• A) 5.00%.
• B) 33.33%.
• C) 5.77%.
• D) 25.00%.

---

Definitions:

Normal Balance

The side (debit or credit) of an account that is usual or expected to increase the balance of that account.

Liability

Financial obligations or debts that a company owes to others, which must be settled through the transfer of assets or provision of services.

Asset

An economic resource that can be owned or controlled to produce value and that is held by a company to produce positive economic value.

Equity

The worth of an owner's stake in a property or business once all debts and other financial obligations have been subtracted.