Assume You Own a Portfolio That Is Invested 50 Percent

question 84

Multiple Choice

Assume you own a portfolio that is invested 50 percent in large-company stocks and 50 percent in corporate bonds. If you want to increase the potential annual return on this portfolio, you could:

• A)decrease the investment in stocks and increase the investment in bonds.
• B)replace the corporate bonds with intermediate-term government bonds.
• C)replace the corporate bonds with Treasury bills.
• D)increase the standard deviation of the portfolio.
• E)reduce the expected volatility of the portfolio.

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Definitions:

Genetic Code

The set of rules by which information encoded within genetic material (DNA or mRNA sequences) is translated into proteins by living cells.

DNA

stands for deoxyribonucleic acid, a molecule that carries the genetic instructions used in the growth, development, functioning, and reproduction of all known living organisms and many viruses.

Chromosomes

Structures within living cells that contain DNA and carry genetic information necessary for cell growth, division, and function.

Conception

The process of becoming pregnant involving fertilization, where an egg and sperm combine to form a zygote.