Exhibit 74
Use the Information Below for the Following Problem(S)

question 88

Multiple Choice

Exhibit 7.4
Use the Information Below for the Following Problem(S)
$$\begin{array} { c c } Asset (A) & \text { Asset (B) } \\\mathrm { E } \left( R _ { A } \right) = 1 [ \% & \mathrm { E } \left( \mathrm { R } _ { B } \right) = \mathrm { g } \% \\\left( \sigma _ { A } \right) = 6 \% & \left( \sigma _ { B } \right) = 5 \% \\W _ { A } =0 .3 & W _ { B } =0 .7 \\C O V _ { A , B } =0 .0008\end{array}$$
-Refer to Exhibit 7.4.What is the expected return of a portfolio of two risky assets if the expected return E(R?) ,standard deviation (s?) ,covariance (COV?,?) ,and asset weight (W?) are as shown above?

• A) 8.6%
• B) 8.1%
• C) 9.3%
• D) 10.2%
• E) 11.6%

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Definitions:

Risk Factor

Anything that increases an individual's likelihood of developing a disease or injury.

Age

The length of time that a person has lived or a thing has existed, often affecting physical and mental capabilities.

Stroke

A medical condition that occurs when the blood supply to part of the brain is interrupted or reduced, leading to brain damage and potential loss of function.

Speaking Difficulty

Challenges or inability to articulate words properly, potentially caused by neurological, physical, or psychological issues.