Suppose That Ms

question 3

Multiple Choice

Suppose that Ms.Lynch can make up her portfolio using a risk-free asset that offers a surefire rate of return of 10% and a risky asset with an expected rate of return of 15%, with standard deviation 5.If she chooses a portfolio with an expected rate of return of 15%, then the standard deviation of her return on this portfolio will be

• A)2.50%.
• B)8%.
• C)5%.
• D)10%.
• E)None of the above.

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Definitions:

Advance Limits

Predetermined restrictions or ceilings on the amount of funding, resources, or credit that can be allocated or extended in advance of certain conditions being met.

Escalating Commitment

The continuation of a course of action even though it is not working.

Increase Effort

Increase effort refers to actions taken to enhance the amount of work or intensity put into achieving a task or objective.

Creativity Skills

Creativity skills involve the ability to think outside the box and generate innovative ideas or solutions.