The Beta of an Active Portfolio Is 1

question 42

Multiple Choice

The beta of an active portfolio is 1.45.The standard deviation of the returns on the market index is 22%.The nonsystematic variance of the active portfolio is 3%.The standard deviation of the returns on the active portfolio is

• A)36.30%.
• B)5.84%.
• C)19.60%.
• D)24.17%.
• E)26.0%.

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