A Portfolio Has an Actual Return of 15

question 32

Multiple Choice

A portfolio has an actual return of 15.17 percent, a beta of .93, and a standard deviation of 7.2 percent. The market return is 13.4 percent and the risk-free rate is 2.8 percent. What is the portfolio's Jensen's alpha?

• A) 2.25 percent
• B) 2.51 percent
• C) 2.67 percent
• D) 3.96 percent
• E) 4.04 percent

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Definitions:

Product Development

The complete process of bringing a new product to market, including idea generation, concept testing, design, engineering, manufacturing, and marketing.

Commercialization

The process of bringing a new product or service to the market, encompassing production, distribution, marketing, sales, and customer support.

Market Testing

The process of evaluating the viability of a new product or service through controlled experiments with target markets before a full-scale launch.

Business Analysis

The practice of identifying business needs and determining solutions to business problems through analysis and problem-solving strategies.