Stocks A,B,and C All Have an Expected Return of 10

question 98

Multiple Choice

Stocks A,B,and C all have an expected return of 10% and a standard deviation of 25%.Stocks A and B have returns that are independent of one another,i.e. ,their correlation coefficient,r,equals zero.Stocks A and C have returns that are negatively correlated with one another,i.e. ,r is less than 0.Portfolio AB is a portfolio with half of its money invested in Stock A and half in Stock B.Portfolio AC is a portfolio with half of its money invested in Stock A and half invested in Stock C.Which of the following statements is CORRECT?

• A) Portfolio AC has an expected return that is less than 10%.
• B) Portfolio AC has an expected return that is greater than 25%.
• C) Portfolio AB has a standard deviation that is greater than 25%.
• D) Portfolio AB has a standard deviation that is equal to 25%.
• E) Portfolio AC has a standard deviation that is less than 25%.

Comprehend the usage and modification of controls in Form and Report Design views.

Recognize the differences between various views and their functionalities.

Understand how to use sorting and grouping features in reports.

Know how to format data and controls in reports and forms.

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Definitions:

Displacement

In psychology, a defense mechanism where an individual redirects emotional feelings from their original source to a substitute target.

Behaviour

The way an individual acts or responds when faced with external or internal triggers.

Anger

A strong feeling of displeasure or hostility, often arising in response to perceived wrong or injustice.

Adrenocorticotropic Hormone

A hormone produced by the pituitary gland that stimulates the adrenal cortex to secrete cortisol and other hormones.