Given the Following Information on Securities E and F, Calculate

question 8

Multiple Choice

Given the following information on securities E and F, calculate the expected return and standard deviation of returns on a portfolio consisting of 40% invested in E and 60% invested in F.
Security E Security F
Expected Return 12% 5%
Standard Deviation of Returns 10% 20%
Correlation coefficient of returns -0.50

• A)13.5%;15%
• B)13.8%;14.4%
• C)13.8%;10.6%
• D)13.5%;8.7%

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Definitions:

Equivalent Units

A concept in process costing that converts partially completed units into a number of fully completed units to accurately calculate costs.

Job Costing

An accounting method used to track the costs associated with a specific job or project to determine its profitability.

Process Costing

A costing methodology used in manufacturing, where costs are assigned to processes or operations to calculate the cost of each unit produced.

Completed Goods

Finished products that are ready for sale.