Share a Has an Expected Return of 20%, and Share

question 81

Multiple Choice

Share A has an expected return of 20%, and share B has an expected return of 4%.However, the risk of share A as measured by its variance is 3 times that of share B.If the two shares are
Combined equally in a portfolio, what would be the portfolio's expected return?

• A)4%
• B)12%
• C)20%
• D)Greater than 20%
• E)Need more information to answer.

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