A Portfolio Consists of One Risky Asset and One Risk-Free

question 46

Multiple Choice

A portfolio consists of one risky asset and one risk-free asset. The risky asset has an expected return of 13.2% and a beta of 1.32. The risk-free asset has an expected return of 1.5%. How much of the portfolio is invested in the risk-free asset if the portfolio beta is 1.02?

• A)16%
• B)23%
• C)32%
• D)45%
• E)54%

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Definitions:

Equifinality

A basic principle of developmental psychopathology which holds that one symptom can have many causes.

Comorbidity

The simultaneous presence of two or more diseases or medical conditions in a patient.

Developmental Psychopathology

The study of the origin and course of individual patterns of behavioral maladaptation, understanding the complexities of mental health issues from a developmental framework.

ADHD

Attention Deficit Hyperactivity Disorder, a neurodevelopmental disorder characterized by patterns of inattention, impulsivity, and hyperactivity.