Use the Table Below to Answer the Following Question(s)

question 21

Multiple Choice

Use the table below to answer the following question(s) .
Jonathan Reese is considering three stocks in which to invest with a fixed budget.The table below provides information on Jonathan's expected returns for each stock.The table also provides information, collected from market researchers, on the variance-covariance matrix of the individual stocks.He expects a total return of at least 10%.

Develop a quadratic optimization model to find the optimal allocation of the budget to each stock, and variance calculations for squared terms and cross-products based on the variance-covariance matrix.
-According to the model, what percentage of the budget should be allocated to Stock 3?

• A)40%
• B)20%
• C)25%
• D)75%

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Definitions:

Fugitive Slave Law

Laws passed by the United States Congress in 1793 and 1850 that provided for the return of slaves who escaped from one state into another state or territory.

Runaway Slaves

Enslaved individuals who fled from their owners in search of freedom or less oppressive conditions, a common phenomenon in the history of slavery in the Americas.

Underground Railroad

A network of secret routes and safe houses established in the United States during the early to mid-19th century, used by African American slaves to escape into free states and Canada.

1848 Election

A U.S. presidential election where Whig party candidate Zachary Taylor defeated Democratic candidate Lewis Cass, amidst the backdrop of discussions about slavery's extension into new territories.