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

question 52

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 is the squared term value for Stock 2 variance?

• A)0.00236
• B)-0.00031
• C)0.00080
• D)0.00430

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Definitions:

Mediation

A conflict resolution method where a neutral third party facilitates dialogue between disputing parties to help them reach an agreement.

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A structured method of operations that follows a defined sequence of steps, often documented and standardized.

Step-review Systems

A structured process for evaluating an employee's performance using a series of progressive steps or stages.

Grievance Procedures

Formal processes used within organizations to address complaints or disputes from employees regarding workplace issues.