Laura Has One Risk-Free Asset and One Risky Stock in Her

question 5

Multiple Choice

Laura has one risk-free asset and one risky stock in her portfolio.The risk-free asset has an expected return of 3.2 percent.The risky asset has a beta of 1.3 and an expected return of 14.9 percent.What is the expected return on the portfolio if the portfolio beta is 0.975?

• A) 7.65 percent
• B) 9.83 percent
• C) 10.73 percent
• D) 11.98 percent
• E) 12.37 percent

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Definitions:

Everyday Actor

An individual who navigates daily life and social interactions based on personal knowledge and societal norms, without necessarily having a deeper understanding of the social sciences.

Microsociological

Pertaining to the study of individual or small group social interactions and behaviors, in contrast to larger societal patterns.

Macrosociology

A branch of sociology that focuses on the study of society as a whole and large-scale social structures.

Christine Williams

A sociologist renowned for her contributions to the study of gender, work, and occupations, particularly in fields traditionally dominated by one gender.