Exhibit 25 -Refer to Exhibit 25

question 52

Multiple Choice

Exhibit 25.11
Use the Information Below for the Following Problem(S)
The last year's performance for four mutual funds is presented below. The market return was 10.70%, last year with a standard deviation of 13.1% and the risk-free rate of return was 5%.
$\begin{array}{l}\quad\quad\quad\quad\quad\quad\quad\quad\text { Standard }\\\begin{array}{cccc}\text { Fund } & \text { Beta } & \text { Deviation }(\%) & \text { Retwun }(\%) \\\hline \mathrm{A} & 1.50 & 18.95 & 12.5 \\\mathrm{~B} & 1.20 & 12.41 & 13.0 \\\text { C } & 0.90 & 9.30 & 11.2 \\\mathrm{D} & 050 & 810 & 95\end{array}\end{array}$
-Refer to Exhibit 25.11.Compute the Sharpe Measure for the A fund.

• A) 0.012
• B) 0.040
• C) 0.069
• D) 0.396
• E) 1.142

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Definitions:

Normal Approximation

A method used in statistics where a normal distribution is used to approximate a different, often more complex, distribution under certain conditions.

Probability

The likelihood of occurrence of an event, often represented as a value between 0 and 1.

Binomial Probability

The probability of achieving a specific number of successes in a fixed number of Bernoulli trials with the same probability of success on each trial.

Normal Curve

A bell-shaped curve that is symmetrical about the mean, representing the distribution of a continuous random variable.