You Own a Portfolio of 5 Stocks and Have 3

question 71

Multiple Choice

You own a portfolio of 5 stocks and have 3 expected states of the economy. You have twice as much invested in Stock A as you do in Stock E. How will the weights be determined when you compute the rate of return for each economic state?

• A)The weights will be the probability of occurrence for each economic state.
• B)Each stock will have a weight of 20% for a total of 100%.
• C)The weights will decline steadily from Stock A to Stock E.
• D)The weights will be based on the amount invested in each stock as a percentage of the total amount invested.
• E)The weights will be based on a combination of the dollar amounts invested as well as the economic probabilities.

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Definitions:

Muscarinic

Pertains to the type of acetylcholine receptors found in various locations in the body, playing significant roles in the function of the parasympathetic nervous system.

Postganglionic Neurons

Neurons that carry signals from the autonomic nervous system's ganglia to the target organ or tissue.

Nicotinic Receptors

A type of acetylcholine receptor found in the nervous system that is activated by nicotine.

Autonomic Ganglia

Clusters of nerve cells outside the central nervous system that relay signals to organs, controlling involuntary functions.