You Are Considering Investing $1000 in a Complete Portfolio

question 41

Multiple Choice

You are considering investing $1000 in a complete portfolio. The complete portfolio is composed of Treasury notes that pay 5% and a risky portfolio, P, constructed with two risky securities X and Y. The optimal weights of X and Y in P are 60% and 40% respectively. X has an expected rate of return of 14% and Y has an expected rate of return of 10%. If you decide to hold 25% of your complete portfolio in the risky portfolio and 75% in the Treasury notes then the dollar values of your positions in X and Y respectively would be ________ and ________.

• A)$300, $450
• B)$150, $100
• C)$100, $150
• D)$450, $300

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Definitions:

Dietary Restraint Proposal

A theory or concept suggesting the self-imposed limitation on food intake and dieting with the aim to control or lose weight.

Chronic Dieter

An individual who persistently engages in dieting, often without long-term success, sometimes leading to cyclical patterns of weight loss and gain.

Restrained Eater

An individual who constantly regulates their food intake in an attempt to control their weight, often leading to cycles of restriction and overeating.

Pain Perception

The subjective experience and interpretation of pain, which can vary widely among individuals, influenced by biological, psychological, and societal factors.