A Portfolio with a 25% Standard Deviation Generated a Return

question 6

Multiple Choice

A portfolio with a 25% standard deviation generated a return of 15% last year when T-bills were paying 4.5%.This portfolio had a Sharpe measure of ____.

• A) 0.22
• B) 0.60
• C) 0.42
• D) 0.25

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Definitions:

Competitive Bidding

The process where various suppliers or contractors submit their bids to win a contract, often used to ensure fairness and value in public and private procurement.

Sealed Bid

A method of bidding where all bids are submitted sealed and opened at an appointed time, ensuring that no bidder knows the amount of the other bids during the bidding process.

Contractor Selection

The process of evaluating and choosing the most suitable contractor for a specific project based on criteria like price, quality, and reliability.

Linear Programming

A mathematical technique used for allocation of scarce resources to various operations with the goal of optimizing a certain objective function, typically profit or cost.