SCENARIO 19-4
a Stock Portfolio Has the Following Returns Under

question 40

Multiple Choice

SCENARIO 19-4
A stock portfolio has the following returns under the market conditions listed below. $$\begin{array} { r c r } \underline{\text { Market Condition }} & \underline{ \text { Probability} } & \underline{ \text { Return }} \\\text { Bull } & 0.4 & \$ 200 \\\text { Stable } & 0.3 & \$ 100 \\\text { Bear } & 0.3 & - \$ 100\end{array}$$
-Referring to Scenario 19-4, what is the return to risk ratio?

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Definitions:

Fair Value

The estimated market value of an asset or liability, based on current prices in active markets.

Reporting Unit

A component or segment of an organization for which discrete financial information is available and reviewed by the operating segment's management.

Carrying Values

The book value of assets and liabilities as reported on the balance sheet, considering depreciation, amortization, and impairment costs.

Systematic Basis

A methodological approach of allocating costs or revenues over a specified period of time in a consistent and logical manner.