Asset a Has an Expected Return of 15% and a Reward-To-Variability

question 12

Multiple Choice

Asset A has an expected return of 15% and a reward-to-variability ratio of .4.Asset B has an expected return of 20% and a reward-to-variability ratio of .3.A risk-averse investor would prefer a portfolio using the risk-free asset and ______.

• A) asset A
• B) asset B
• C) no risky asset
• D) can't tell from the data given

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Definitions:

Critical Election

An election that signifies a major shift in the electorate's preferences, leading to a new political alignment or party system.

Voter Turnout

The percentage of eligible voters who cast a ballot in an election, a critical measure of democratic participation.

Preindustrial Age

A period before the widespread use of machines and the advent of industrial production processes, characterized by agrarian societies and handmade goods.