Asset a Has an Expected Return of 20% and a Standard

question 22

Multiple Choice

Asset A has an expected return of 20% and a standard deviation of 25%. The risk-free rate is 10%. What is the reward-to-variability ratio?

• A) .40
• B) .50
• C) .75
• D) .80

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Definitions:

Constant

A situation or value that does not change or vary, often used in the context of scientific experiments or mathematical equations.

REM Sleep

REM sleep, or Rapid Eye Movement sleep, is a phase of sleep characterized by fast eye movements, vivid dreams, and increased brain activity.

N1 Sleep

The initial stage of non-REM sleep characterized by light sleep, from which a person can be easily awakened.

N2 Sleep

A stage of sleep within the non-REM cycle characterized by sleep spindles and K-complexes, marking a deeper sleep than N1 and preceding the deepest, N3 stage.