If the Expected Return on Stock 1 Is 6%, and the Expected

question 21

Multiple Choice

If the expected return on Stock 1 is 6%, and the expected return on Stock 2 is 20%, the expected return on a two-asset portfolio that holds 10% of its funds in Stock 1 and 90% in Stock 2 is:

• A) 11.52%
• B) 13%
• C) 18.6%
• D) 19.14%

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Definitions:

Lung Cancer

A type of cancer that originates in the lungs, characterized by the uncontrolled growth of cells in the lung tissue.

Asthma

A chronic inflammatory disease of the airways that causes episodes of wheezing, breathlessness, chest tightness, and coughing.

Snoring

The act of making a snorting or grunting sound while asleep, often due to partial obstruction of the airways.

CPAP Machine

A medical device that provides a constant stream of air pressure to keep the sleeper's airway open, used for treating obstructive sleep apnea.