What Is Nico's Portfolio Beta If He Invests an Equal

question 149

Multiple Choice

What is Nico's portfolio beta if he invests an equal amount in Asset X with a beta of 0.60, Asset Y with a beta of 1.60, and the risk-free asset?

• A) 1.24
• B) 1.00
• C) 0.73
• D) 0.66

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Definitions:

Size Constancy

The perceptual understanding that an object's size remains the same despite changes in the distance from which it is observed.

Perceptual Constancy

The brain's ability to recognize that an object's characteristics remain the same despite changes in the sensory input, such as distance or lighting.

Retinal Image

The image of an object that is projected on the retina. Its size increases with the size of that object and decreases with the object’s distance from the eye.

Size Constancy

The perceptual phenomenon where the size of an object is perceived to remain constant despite variations in the distance or size of the image it projects on the retina.