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A Portfolio Consists of Two Securities: a Risk-Free Asset and an Equity

question 68

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A portfolio consists of two securities: a risk-free asset and an equity security.The expected return on the risk-free asset is 4.75 percent.The expected return of the equity security is 17 percent with a standard deviation of 23 percent.What is the portfolio expected return if the standard deviation for the portfolio is 18 percent?


Definitions:

Oncogenes

Genes that have the potential to cause cancer by transforming a normal cell into a tumor cell when mutated or expressed at high levels.

Mitosis Stages

The phases of cell division including prophase, metaphase, anaphase, and telophase, through which a single cell divides into two genetically identical daughter cells.

Interphase

The phase of the cell cycle where the cell prepares for division by replicating its DNA and increasing in size.

Chromosomes

Thread-like structures located within the nucleus of animal and plant cells, made of protein and a single molecule of deoxyribonucleic acid (DNA).

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