A Portfolio Has an Average Return of 13

question 60

Multiple Choice

A portfolio has an average return of 13.3 percent, a standard deviation of 14.7 percent, and a beta of 1.35. The risk-free rate is 2.8 percent. What is the Sharpe ratio?

• A) .49
• B) .52
• C) .63
• D) .71
• E) .75

---

Definitions:

Work-in-Process Inventory

Work-in-process inventory includes all the materials, labor, and overhead costs for products that are in the production process but are not yet complete.

Labor Distribution Report

A report issued by the payroll department to categorize all the types of labor incurred during the week.

Manufacturing Overhead-Applied

Refers to the allocation of all indirect costs of production to the products manufactured.

Manufacturing Overhead-Control

An account that tracks the costs associated with the manufacturing process that are not directly tied to the production of goods, such as utilities and manager salaries.