What Is the Expected Return on a Portfolio That Will

question 12

Multiple Choice

What is the expected return on a portfolio that will decline in value by 13% in a recession,will increase by 16% in normal times,and will increase by 23% during boom times if each scenario has equal likelihood?

• A) 8.67%
• B) 13.00%
• C) 13.43%
• D) 17.33%

---

Definitions:

National Congress

A formal gathering or assembly at the national level, typically of representatives or delegates, involved in discussing and making decisions on matters of national importance.

Henry Kissinger

A German-born American diplomat and political scientist who served as National Security Advisor and later Secretary of State under Presidents Nixon and Ford, known for his role in shaping U.S. foreign policy, particularly in relation to Vietnam and the Soviet Union.

Bombing of North Vietnam

Refers to the extensive aerial bombardment campaign conducted by the United States against North Vietnam during the Vietnam War.

President Nixon

Richard Nixon was the 37th President of the United States, serving from 1969 to 1974, and is best known for his involvement in the Watergate scandal.