The Following Table Summarizes Selected Statistics for Two Portfolios for a 10-Year

question 29

Multiple Choice

The following table summarizes selected statistics for two portfolios for a 10-year period. Assume that the risk-free rate is 4% over this period. As measured by the Sharpe ratio, the fund with the superior risk-adjusted performance during this period is ________.

• A) Fund A because it has a lower positive Sharpe ratio than Fund B
• B) Fund B because it has a lower positive Sharpe ratio than Fund A
• C) Fund A because it has a higher positive Sharpe ratio than Fund B
• D) Fund B because it has a higher positive Sharpe ratio than Fund A

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Definitions:

American Settlement

The colonizing or establishing of communities within the United States by immigrants or early settlers.

Western American Migrants

Individuals or groups who moved to the western territories of the United States during the period of westward expansion.

Native Americans

Indigenous peoples of the Americas, encompassing a wide variety of cultures, languages, and histories prior to European colonization.

Treaties

Formal agreements between two or more sovereign states, governed by international law, covering a wide range of topics such as peace, trade, and borders.