A Portfolio Has an Expected Return of 11

question 354

Multiple Choice

A portfolio has an expected return of 11.57%. The portfolio consists of stock A with an expected return of 8.6% and stock B with a beta of 1.28. The risk-free rate of return is 3% and the market risk
Premium is 8%. What is the portfolio weight of Stock A?

• A) 31%
• B) 32%
• C) 34%
• D) 36%
• E) 37%

Understand the calculation and interpretation of confidence intervals for the slope of the regression line.

Recognize and interpret the significance of the r-squared value and the standard error in regression analysis.

Understand how to determine and interpret confidence and prediction intervals in the context of regression analysis.

Develop the ability to conduct hypothesis testing for the slope of the regression line and determine its significance.

---

Definitions:

Knowledge

Information, understanding, and skills that individuals acquire through experience or education; the theoretical or practical understanding of a subject.

Abilities

The skills and competences a person possesses that enable them to perform specific tasks successfully.

Skills

The ability to perform tasks effectively and efficiently, often developed through experience, training, or education.

Potential Strengths

Abilities or qualities that could become significant assets if developed or leveraged effectively.