A Portfolio Consists of Securities a and B in the Proportions

question 21

Multiple Choice

A portfolio consists of Securities A and B in the proportions of .7 and .3. Security A has a random error standard deviation of 7%; Security B at 11%. The portfolio beta is 1.2, and the market standard deviation is 10%. The total portfolio variance is

• A) 158.
• B) 204.
• C) 265.
• D) 179.

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Definitions:

Polite Request

A respectful or courteous expression of desire or need.

Status Gap

The perceived or real differences in social, professional, or economic standing between individuals, groups, or entities, often leading to disparities in power or access to resources.

Target Dependence

Target dependence describes a situation or condition where outcomes or processes are heavily reliant on specific goals or objectives for their direction and meaning.

Coercive Power

The power to force someone to do something against their will by using threats, punishment, or other forms of pressure.