The Following Information Regarding a Portfolio of Two Stocks Are

question 233

Multiple Choice

The following information regarding a portfolio of two stocks are given: w₁ = .65,w₂ = .35,E(R₁) = .12,and E(R₂) = .14.Which of the following regarding the portfolio expected return,E(R_p) ,is correct?

• A).260
• B).127
• C).346
• D).374

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Definitions:

Negotiable

Capable of being discussed, transferred, or modified in terms of conditions or agreement.

Maker

In the context of negotiable instruments, the individual or entity that creates and signs the instrument, promising to pay the specified amount.

Liability

Liability is the legal responsibility to settle debts or legal claims. This encompasses both financial obligations and the duty to compensate for harm or damage caused.

Negotiable Instrument

A document in writing that promises to pay a designated sum of money, either when asked or at a predetermined time, with the document specifying who must make the payment.