If an Investor's Portfolio Is Allocated 75% to the Market

question 43

Multiple Choice

If an investor's portfolio is allocated 75% to the market portfolio and 25% to Treasury bills, then the investor should expect to receive:

• A)the risk-free rate plus 75% of the expected return on the market.
• B)the risk-free rate plus 75% of the expected market risk premium.
• C)75% of the expected return on the market.
• D)25% of the risk-free rate plus 75% of the expected return on the market.

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