Portfolio X Had an Average Quarterly Return of 5

question 11

Multiple Choice

Portfolio X had an average quarterly return of 5.2% with a standard deviation of 6.5%. The market had an average quarterly return of 6.1% with a standard deviation of 10.5%. The average riskfree rate was 3%. Using the reward-to-variability ratio,

• A) the portfolio had an inferior performance.
• B) Portfolio X lies above the ex post CML.
• C) Portfolio X has a slope lower than that of the CML.
• D) there is insufficient data to compare them.

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Definitions:

Palisade Mesophyll

The layer of closely packed, elongated cells found under the upper epidermis of leaves, responsible for most of the photosynthesis in plants.

Photosynthesis

This is a process where green plants and a few other life forms use sunlight to generate nutrients from water and carbon dioxide.

Subsidiary Cells

Specialized cells surrounding the stomatal pores in plants, aiding in the regulation of gas exchange and water release.

Vascular Bundles

Structures in plants that contain xylem and phloem tissues, responsible for the transport of water, nutrients, and photosynthetic products throughout the plant.