An Investor Currently Holds the Following Portfolio

question 58

Multiple Choice

An investor currently holds the following portfolio:

The investor is worried that the beta of his portfolio is too high,so he wants to sell some stock C and add stock D,which has a beta of 1.0,to his portfolio.If the investor wants his portfolio to have a beta of 1.72,how much stock C must he replace with stock D?

• A) $18,000
• B) $24,000
• C) $31,000
• D) $36,000

---

Definitions:

Personal Construct

A psychological theory proposing that individuals organize their experiences and view the world through unique, personal systems of constructs.

Cultural Influences

The ways in which the values, beliefs, and practices of a culture shape and impact individuals' behaviors and perceptions.

Psychological Need

An inherent aspect of mental well-being that motivates behavior, such as the need for esteem, belonging, or achievement.

Ego-resilient

A personality trait characterized by adaptability, flexibility, and the ability to maintain a positive outlook despite stress and adversity.