Consider Two Perfectly Negatively Correlated Risky Securities a and B

question 4

Multiple Choice

Consider two perfectly negatively correlated risky securities A and B. A has an expected rate of return of 10% and a standard deviation of 16%.B has an expected rate of return of 8% and a standard deviation of 12%.The risk-free portfolio that can be formed with the two securities will earn _____ rate of return.

• A)8.5%
• B)9.0%
• C)8.9%
• D)9.9%

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Definitions:

Whistle Blowing

Whistle blowing involves reporting illegal, unethical, or dangerous practices by an organization or individual, typically by someone from within the organization.

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Smelting Plant

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