Stock a Has a Standard Deviation of 15 Percent Per

question 24

Multiple Choice

Stock A has a standard deviation of 15 percent per year and stock B has a standard deviation of 21 percent per year.The correlation between stock A and stock B is 0.30.You have a portfolio of these two stocks wherein stock B has a portfolio weight of 60 percent.What is your portfolio standard deviation?

• A) 14.87 percent
• B) 15.50 percent
• C) 16.91 percent
• D) 17.45 percent
• E) 18.03 percent

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Definitions:

Power Distance

A cultural dimension that describes the extent to which individuals in a society accept and expect power to be distributed unequally.

Sense of Individualism

A philosophy or social outlook that emphasizes the moral worth of the individual.

Global Leadership Skills

The ability to exercise effective leadership in a variety of countries.

Societal Hierarchy

A structured ranking within a society where individuals or groups are placed at various levels based on status, power, or authority.