The Expected Value and the Standard Deviation of Returns for Asset

question 129

Multiple Choice

The expected value and the standard deviation of returns for asset A is ________. (See table below.) Asset A

• A) 12 percent and 4 percent
• B) 12.7 percent and 2.3 percent
• C) 12.7 percent and 4 percent
• D) 12 percent and 2.3 percent

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Definitions:

Collection Time

The average amount of time it takes for a business to receive payments owed by its customers after a sale has been made, indicative of a company's efficiency in collecting accounts receivable.

Short-term Securities

Securities that typically mature in one year or less, often used for investment with lower risk and short-duration goals.

Zero Balance Accounts

Bank accounts that automatically maintain a zero balance by moving funds from a master account in an amount only large enough to cover checks presented.

Master Account

A primary account that is used to manage multiple sub-accounts under a single umbrella, often for purposes of consolidation and easier management.