The Beta of an Active Portfolio Is 1

question 29

Multiple Choice

The beta of an active portfolio is 1.20. The standard deviation of the returns on the market index is 20%. The nonsystematic variance of the active portfolio is 1%. The standard deviation of the returns on the active portfolio is

• A) 3.84%.
• B) 5.84%.
• C) 19.60%.
• D) 24.17%.
• E) 26.0%.

---

Definitions:

Leadership Literature

Published works and scholarly articles that discuss theories, practices, and studies related to the field of leadership.

Top Executives

High-ranking officials within an organization responsible for developing policies, strategies, and making critical decisions.

Middle Managers

Individuals in an organization who manage at a level between the executive leaders and the operational staff, often overseeing specific departments or functions.

Competitive Strategy

A method developed by a company to gain a competitive edge and achieve superior profitability in its industry.