An Investor Can Design a Risky Portfolio Based on Two

question 52

Multiple Choice

An investor can design a risky portfolio based on two stocks,A and B. The standard deviation of return on stock A is 20% while the standard deviation on stock B is 15%. The correlation coefficient between the return on A and B is 0%. The standard deviation of return on the minimum variance portfolio is _________.

• A) 0%
• B) 6%
• C) 12%
• D) 17%

Distinguish between different components on Blake and Mouton's Leadership Grid.

Learn about significant leadership behavior studies such as the Ohio State studies, University of Michigan studies, and the leadership behavior of Blake and Mouton.

Recognize opportunistic leadership and its impact on leadership effectiveness.

Understand the tax implications of selling or exchanging qualified small business stock under Section 1202.

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Definitions:

Efficient Scale

The level of production that minimizes the average total cost of producing a good or service. It represents the most cost-effective point of operation for a business.

Maximum Profit

The highest possible profit a firm can achieve when it has optimized its production and sales, given the constraints of the market.

Long-Run Adjustment

The process through which inputs and outputs fully adjust to changes in the market, considering all potential variable and fixed costs.

Zero Profit

A situation where a firm's total revenue is exactly equal to its total costs, resulting in no net profit.