What Is the Standard Deviation of the Returns on a Portfolio

question 28

Multiple Choice

What is the standard deviation of the returns on a portfolio that is invested in stocks A,B,and C? Twenty five percent of the portfolio is invested in stock A and 40 percent is invested in stock C.

• A)6.31 percent
• B)6.49 percent
• C)7.40 percent
• D)7.83 percent
• E) 8.72 percent

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Definitions:

Newspaper Mastheads

The name of a newspaper as it appears at the top of the front page, often considered an intangible asset due to its brand value.

Patents

Legal rights granted to inventors or their assignees to exclusively exploit an invention for a certain period of time.

Acquiree

The business or businesses of which the acquirer obtains control in a business combination.

Acquisition Consideration

The total value transferred by one company to acquire another, including cash, shares, and other assets.