Stock a Has a Standard Deviation of 15 Percent Per

question 55

Multiple Choice

Stock A has a standard deviation of 15 percent per year and stock B has a standard deviation of 8 percent per year.The correlation between stock A and stock B is .40.You have a portfolio of these two stocks wherein stock B has a portfolio weight of 40 percent.What is your portfolio variance?

• A).01143
• B).01214
• C).01329
• D).01437
• E).01470

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Definitions:

Mental Demands

Refers to the cognitive efforts required by a job, including thinking, decision making, calculating, and remembering.

Memorization

The process of committing something to memory or learning information by heart.

Compressed Workweek

A work schedule that allows employees to work the standard number of weekly hours in fewer days, often resulting in extended workdays and a shorter workweek.

Work Schedule

The predetermined days and hours set for employees to perform their job duties, which can vary in flexibility, duration, and structure.