You Are Considering Investing $1,000 in a Complete Portfolio

question 75

Multiple Choice

You are considering investing $1,000 in a complete portfolio. The complete portfolio is composed of treasury bills that pay 5% and a risky portfolio, P, constructed with 2 risky securities X and Y. The optimal weights of X and Y in P are 60% and 40% respectively. X has an expected rate of return of 14% and Y has an expected rate of return of 10%.
-If you decide to hold 25% of your complete portfolio in the risky portfolio and 75% in the treasury bills then the dollar values of your positions in X and Y respectively would be __________ and _________.

• A) $300, $450
• B) $150, $100
• C) $100, $150
• D) $450, $300

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Definitions:

Book of Genesis

The first book of the Bible and the Torah, outlining the creation of the world and the early history of humanity according to Jewish, Christian, and Islamic traditions.

Alleles

Variants or versions of a gene found at the same place on a chromosome that can lead to differences in the physical or physiological traits expressed by that gene.

Single Gene

Refers to a trait or condition determined by a single gene in an organism's genome.

DNA

Deoxyribonucleic acid, the self-replicating material present in nearly all living organisms, serving as the carrier of genetic information.