An Investor Has a $100,000 Portfolio of Which $75,000 Has

question 2

Multiple Choice

An investor has a $100,000 portfolio of which $75,000 has been invested in Stock A and the remainder in Stock B. Other characteristics of the portfolio are shown in the accompanying table. The expected return of the portfolio is ________.

• A) 6.30%
• B) 6.75%
• C) 7.38%
• D) 13.50%

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Definitions:

External Support

Assistance or resources provided by entities outside of an organization, which can include financial, advisory, or technical support.

Normal Return

A rate of return on investment that is considered sufficient to maintain the current level of economic activity without additional profit.

Government Regulates

The actions taken by governments to control, direct, or manage different sectors or aspects of the economy or society, often through laws and regulations.

Economic Profit

The financial margin that results from subtracting a business's complete expenditures, both seen and unseen, from its gross income.