Stock a Has a Standard Deviation of 20 Percent Per

question 22

Multiple Choice

Stock A has a standard deviation of 20 percent per year and stock B has a standard deviation of 15 percent per year.The correlation between stock A and stock B is .35.You have a portfolio of these two stocks wherein stock B has a portfolio weight of 40 percent.What is your portfolio variance?

• A) 0.02022
• B) 0.02156
• C) 0.02239
• D) 0.02247
• E) 0.02304

---

Definitions:

Chess and Thomas

Researchers known for their contributions to developmental psychology, particularly in the study of temperament in children.

Temperament

Refers to the innate characteristics of an individual's personality, including tendencies toward emotional reactivity, intensity, and sociability.

Behavioral Style

The characteristic way in which an individual reacts and interacts with the environment, often consistent across different situations.

Personal Responsibility

The idea that individuals are accountable for their own actions and wellbeing, including taking charge of their life decisions and accepting the consequences.