Exhibit 715
Use the Information Below for the Following Problem(S)

question 12

Multiple Choice

Exhibit 7.15
Use the Information Below for the Following Problem(S)
$\begin{array}{cc}\text { Asset }(\mathrm{A}) & \text { Asset }(\mathrm{B}) \\\hline \mathrm{E}\left(\mathrm{R}_{\mathrm{A}}\right) =14 \% & \mathrm{E}\left(\mathrm{R}_{\mathrm{B}}\right) =16 \% \\\left(\sigma_{\mathrm{A}}\right) =13 \% & \left(\sigma_{\mathrm{B}}\right) =18 \% \\\mathrm{~W}_{\mathrm{A}}=0.4 & \mathrm{~W}_{\mathrm{B}}=0.6\end{array}$
                $\mathrm{COV}_{\mathrm{AB}}=0.0024$

-Refer to Exhibit 7.15.What is the standard deviation of this portfolio?

• A) 10.0%
• B) 12.5%
• C) 14.4%
• D) 15.5%
• E) 16.0%

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Definitions:

Imports

Goods or services brought into a country from abroad for sale, typically requiring payment to the origin country or entity.

Sole Proprietorship

A business structure where a single individual owns, manages, and is personally responsible for all aspects of the business, including liabilities.

Liability

A legal obligation or debt that an entity is required to pay to another.

Financial Capital

Economic resources measured in terms of money used by entrepreneurs and businesses to buy what they need to make their products or to provide their services.