Stock S Is Expected to Return 12 Percent in a Boom

question 22

Multiple Choice

Stock S is expected to return 12 percent in a boom and 6 percent in a normal economy.Stock T is expected to return 20 percent in a boom and 4 percent in a normal economy.There is a probability of 40 percent that the economy will boom; otherwise,it will be normal.What is the portfolio variance if 30 percent of the portfolio is invested in Stock S and 70 percent is invested in Stock T?

• A).002220
• B).004056
• C).006224
• D).008080
• E).098000

---

Definitions:

Encoder

In communication, it refers to a device or software that converts information from one format or code into another, or the person or system that performs this action.

Communication Channel

The medium through which information is transmitted from one entity to another, which can be verbal, non-verbal, or digital.

Message Funnel

A process or model that captures and condenses information from various sources to streamline communication within organizations.

Shannon-Weaver

Refers to the Shannon-Weaver Model of Communication, a theoretical framework that outlines how information is transmitted from a sender to a receiver, emphasizing the components and processes involved in communication.