Consider the Following Portfolio of Assets What Is the Standard Deviation of the Portfolio (Round to |

question 15

Multiple Choice

Consider the following portfolio of assets: $$\begin{array} { | c | c | c | c | c | c | } \hline \text { Loan } i & \text { Weight } i & \text { Expected return i } & \sigma & \sigma ^ { 2 } & \\\hline 1 & 0.45 & 15 \% & 6.05 \% & 36.60 \% & \mathrm { P } _ { 12 } = - 0.2 \\\hline 2 & 0.55 & 13 \% & 8.75 \% & 76.56 \% & \sigma _ { 12 } = - 4.0 \% \\\hline\end{array}$$ What is the standard deviation of the portfolio (round to two decimals) ?

• A)(0.45)( ? 36.60) + (0.55)( ? 76.56) = 7.51%
• B)( ? 36.60) + ( ? 76.56) = 14.80%
• C) ? 57.28 = 7.57%
• D) ? 25.33 = 5.03%

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Definitions:

Reagents

Chemical substances that are employed to bring about a chemical reaction in a provided set of reactants.

Reaction

A process in which substances (reactants) are transformed into different substances (products) through chemical change.

2-Methyl-2-Octene

An organic compound characterized by an eight-carbon chain with a double bond between carbon numbers 2 and 3, and a methyl group attached to the second carbon.

2-Methyloctan-3-Ol

A chemical compound, specifically an alcohol, that is derived by adding a methyl group and a hydroxyl group to an octane chain.