What Is the Expected Return on a Portfolio Comprised of €4,000

question 4

Multiple Choice

What is the expected return on a portfolio comprised of €4,000 in share M and €6,000 in share N if the economy enjoys a boom period?
$\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad$ Returns if
$\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad\quad$ State Occurs
$\begin{array}{|l|l|l|l|}\hline \text { State of Economy } & \text { Probability of State of Economy } & \text { ShareM } & \text { Share N } \\\hline \text { Boom } & 10 \% & 18 \% & 10 \% \\\hline \text { Normal } & 75 \% & 7 \% & 8 \% \\\hline \text { Recession } & 15 \% & -20 \% & 6 \% \\\hline\end{array}$

• A)6.4%
• B)6.8%
• C)10.4%
• D)13.2%
• E)14.0%

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Definitions:

Buying Center

A group of individuals within an organization who are involved in the process of evaluating and making purchase decisions.

Gatekeepers

Persons or organizations that manage the access to certain assets, typically data or resources.

Technical Experts

Individuals with specialized knowledge or skills in a specific field or industry, often relied upon for their precise understanding of complex subjects.

Buying Center

A group within an organization involved in the process of purchasing goods or services, typically including roles such as users, influencers, and decision-makers.