An Investor Has $2,000 Invested in Stock a and $5,000

question 17

Multiple Choice

An investor has $2,000 invested in stock A and $5,000 in stock B. The daily volatilities of A and B are 1.5% and 1% respectively and the coefficient of correlation is 0.8. What is the one day 99% VaR? Assume that returns are multivariate normal (Note that N(-2.326) =0.01)

• A) $177
• B) $135
• C) $215
• D) $331

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Definitions:

Reproductive Age

The period in an individual's life during which they are biologically capable of reproducing offspring.

Antibiotic Resistance

The capability of bacteria and other microbes to resist the effects of an antibiotic to which they were once sensitive, leading to the persistence and spread of infections.

Antibiotic Treatment

The use of drugs to kill or inhibit the growth of bacteria to treat bacterial infections.

Evolution

The process through which species undergo genetic changes over time, leading to diversity and complexity in the living world.