An Investor Can Design a Risky Portfolio Based on Two

question 76

Multiple Choice

An investor can design a risky portfolio based on two stocks, A and B. The standard deviation of return on stock A is 20%, while the standard deviation on stock B is 15%. The correlation coefficient between the returns on A and B is 0%. The rate of return for stocks A and B is 20% and 10% respectively. The standard deviation of return on the minimum-variance portfolio is ________.

• A) 0%
• B) 6%
• C) 12%
• D) 17%

Recognize the calculation method for median with an even number of scores.

Analyze the impact of extreme scores on measures of central tendency.

Understand the different levels of measurement and their characteristics.

Identify the appropriate conditions for using each level of measurement.

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Definitions:

Income Statement

A financial statement that reports a company's revenues and expenses over a specific period, resulting in a net profit or loss.

Asset Section

The asset section is part of a balance sheet that lists all assets owned by a company, including current, fixed, and intangible assets.

Utility Expense

Costs incurred for services such as electricity, gas, water, and sewer, which are necessary for operating a business.

Balance Sheet

An account statement depicting the financial position of a company through its assets, obligations, and equity of shareholders at a certain time.