Use the Information for the Question(s)below

question 2

Multiple Choice

Use the information for the question(s) below.
Tom's portfolio consists solely of an investment in Merck stock.Merck has an expected return of 13% and a volatility of 25%.The market portfolio has an expected return of 12% and a volatility of 18%.The risk-free rate is 4%.Assume that the CAPM assumptions hold in the market.
-Assuming that Tom wants to maintain the current expected return on his portfolio,then the minimum volatility that Tom could achieve by investing in the market portfolio and risk-free investment is closest to:

• A)20%.
• B)25%.
• C)22%.
• D)18%.

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Definitions:

Blood Pressure

The force exerted by circulating blood on the walls of blood vessels, critical for maintaining bodily functions and indicative of cardiovascular health.

Masculinization

The process of developing male physical characteristics or traits, often driven by hormonal changes, either naturally during puberty or as a result of medical interventions.

Progestin

A synthetic hormone used to maintain pregnancy that can cause masculinization of the fetus.

Motility

Self-propulsion.