The Expected Rate of Return on a Stock Portfolio Is

question 29

Multiple Choice

The expected rate of return on a stock portfolio is a weighted average where the weights are based on the:

• A) number of shares owned of each stock.
• B) market price per share of each stock.
• C) market value of the investment in each stock.
• D) original amount invested in each stock.
• E) cost per share of each stock held.

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Definitions:

Actual Costs

The precise expenses incurred for materials, labor, and overhead in producing goods or providing services.

Standard Costs

Pre-determined or estimated costs used as a benchmark to compare with the actual costs incurred.

Actual Costs

The real, total expenses incurred during the production or acquisition of goods and services.

Fixed Overhead

Fixed costs that do not vary with the level of production or sales over a short term, including rental expenses, salaries, and insurance.