Julie Wants to Create a $5,000 Portfolio

question 36

Multiple Choice

Julie wants to create a $5,000 portfolio.She also wants to invest as much as possible in a high risk stock with the hope of earning a high rate of return.However, she wants her portfolio to have no more risk than the overall market.Which one of the following portfolios is most apt to meet all of her objectives?

• A)Invest the entire $5,000 in a stock with a beta of 1.0
• B)Invest $2,500 in a stock with a beta of 1.98 and $2,500 in a stock with a beta of 1.0
• C)Invest $2,500 in a risk-free asset and $2,500 in a stock with a beta of 2.0
• D)Invest $2,500 in a stock with a beta of 1.0, $1,250 in a risk-free asset, and $1,250 in a stock with a beta of 2.0
• E)Invest $2,000 in a stock with a beta of 3, $2,000 in a risk-free asset, and $1,000 in a stock with a beta of 1.0

Comprehend the importance of situational context in assessing behaviors.

Acknowledge the role of biological factors in mental health, such as genetics, brain chemistry, and brain structure.

Understand how learned experiences and behaviors contribute to psychological disorders.

Examine the principles behind different therapeutic interventions based on various models of abnormality.

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Definitions:

Finder

An individual or entity that locates and provides a specific item, person, or service, often for a fee or commission.

Waiver

The voluntary relinquishment or surrender of a known right, claim, or privilege, often documented in written form.

Estoppel

A legal principle preventing someone from arguing something contrary to an earlier stance if it would harm another person who relied on the initial position.

Refuse

To decline to accept, submit to, or do something.