Exhibit 18-11
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)

question 76

Multiple Choice

Exhibit 18-11
USE THE FOLLOWING INFORMATION FOR THE NEXT PROBLEM(S)
The last year's performance for four mutual funds is presented below. The market return was 10.70%, last year with a standard deviation of 13.1% and the risk-free rate of return was 5%. $$\begin{array} { c c c c } \text { Fund } & \text { Beta } & \begin{array} { c } \text { Standard } \\\text { Deviation (\%) }\end{array} & \text { Return (\%) } \\\hline \text { A } & 1.50 & 18.95 & 12.5 \\\text { B } & 1.20 & 12.41 & 13.0 \\\text { C } & 0.90 & 9.30 & 11.2 \\\text { D } & 0.50 & 8.10 & 9.5\end{array}$$
-Refer to Exhibit 18-11. Compute the Jensen Measure for the B fund.

• A) 1.16%
• B) 2.31%
• C) 6.90%
• D) 9.60%
• E) 10.13%

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Definitions:

Attitude Object

Anything toward which an individual has a persistent psychological and evaluative orientation, encompassing feelings, beliefs, and behavioral dispositions.

Earl Grey

A type of tea flavored with the oil from the rind of bergamot orange, noted for its distinctive flavor.

Attitude Object

Anything that an individual has a specific attitude or feeling about, which can range from physical objects to abstract concepts.

Temptation

A desire to engage in short-term urges for enjoyment, often at the expense of long-term goals.