You Have a 2-Stock Portfolio with an Expected Return of 10.6

question 39

Multiple Choice

You have a 2-stock portfolio with an expected return of 10.6 percent.Stock A has an expected return of 12 percent while Stock B is expected to return 8 percent.What is the portfolio weight of Stock A?

• A)76%
• B)72%
• C)61%
• D)65%
• E)68%

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Definitions:

Experimental Method

A research method involving the manipulation of variables to determine cause-and-effect relationships in controlled conditions.

Cause-And-Effect

The principle that every event (effect) is produced by a cause, showcasing the relationship between actions and their outcomes.

Correlational Method

A research methodology that examines the relationship between two or more variables to determine if a correlation exists.

Experimental Group

The group in an experiment that receives the variable being tested, which is contrasted with a control group that does not receive the experimental treatment.