Given an Optimal Risky Portfolio with Expected Return of 14

question 11

Multiple Choice

Given an optimal risky portfolio with expected return of 14% and standard deviation of 22% and a risk free rate of 6%,what is the slope of the best feasible CAL?

• A)0.64
• B)0.14
• C)0.08
• D)0.33
• E)0.36

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Definitions:

Expense Accounts

Accounts used to track the expenditures incurred by a business, categorized for financial reporting and analysis.

Debit Balances

Amounts owed in an account, typically representing assets or expenses, that indicate the total charges or costs.

Net Income

The sum a company retains as profit after removing costs, expenses, and taxes from its total income.

Retained Earnings

The portion of a company's profits that is kept or retained within the business instead of being paid out to shareholders as dividends.