An Investor Owns a Portfolio Consisting of Two Mutual Funds

question 36

Multiple Choice

An investor owns a portfolio consisting of two mutual funds, A and B, with 35% invested in A. The following table lists the inputs for these funds. The expected return for the portfolio return is ________.

• A) 5.76%
• B) 7.65%
• C) 6.75%
• D) 12.45%

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Definitions:

Grounded Cognition

The theory that cognitive processes are deeply rooted in bodily interactions with the environment.

Concept

A mental representation or an abstract idea that groups together objects, events, qualities, or relations on the basis of common properties.

Mental Simulations

The process of imagining or envisioning scenarios in one's mind to predict outcomes, solve problems, or plan actions.

Defined by Function

Describes objects, concepts, or processes identified primarily by what they do or their role rather than by their form or nature.