You Are Computing the Expected Return on a Portfolio of Six

question 78

Multiple Choice

You are computing the expected return on a portfolio of six stocks given three states of the economy. How will the expected return of the portfolio be computed given an economic state?

• A) Add up the returns on each stock and divide by 6
• B) Sum up the returns on each stock and divide by (6 - 1)
• C) Multiply the individual returns with the weights based on the market value of each of the stock position
• D) Multiply the individual returns with the weights based on the relative prices of each stock position
• E) Multiply the individual returns with the weights based on the number of shares of each stock owned

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Definitions:

Nutritional Value

Nutritional value refers to the content of essential nutrients in food, such as vitamins, minerals, and proteins, important for supporting life and health.

Reabsorption

The process by which the kidneys filter the blood, removing waste but reabsorbing water and other essential substances back into the bloodstream.

Diabetes Insipidus

A disorder marked by an imbalance of water in the body, leading to intense thirst and the production of large amounts of urine.

ADH

Antidiuretic hormone, a peptide hormone that regulates the amount of water reabsorbed by the kidneys.