-What Is the Expected Return of a Portfolio 60 Percent

question 18

Multiple Choice

$\begin{array}{c}\begin{array}{c}\underline{\text {State of the economy}}\\\text {Boom}\\\text {Recession}\end{array}\begin{array}{c}\underline{\text {Probability}}\\.3\\.7\\\end{array}\begin{array}{c}\underline{\text {Stock Q}}\\14 \% \\8\% \\\end{array}\end{array}$

-What is the expected return of a portfolio 60 percent invested in Stock P and the remainder in Stock Q?

• A) 14.30%
• B) 13.19%
• C) 15.17%
• D) 12.56%
• E) 10.66%

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Definitions:

Inherent Goodness

The belief or principle that people are born inherently good, with naturally positive qualities.

Flawed Nature

The concept that inherent imperfections exist within individuals or systems, leading to potential failures or moral shortcomings.

Environment Influences

The impact of surrounding physical and social settings on an individual's behavior, thoughts, and feelings.

Anal Stage

The second stage in Freud’s psychosexual development, occurring from about 18 months to three years of age, where the child's focus is on controlling bladder and bowel movements.