In a Particular Year, Razorback Mutual Fund Earned a Return

question 37

Multiple Choice

In a particular year, Razorback Mutual Fund earned a return of 1% by making the following investments in asset classes:

The return on a bogey portfolio was 2%, calculated from the following information.

The contribution of asset allocation across markets to the Razorback Fund's total excess return was

• A) -1.80%.
• B) -1.00%.
• C) 0.80%.
• D) 1.00%.
• E) 1.80%

---

Definitions:

Functional Currency

The currency of the primary economic environment in which an entity operates, usually determined by the currency that mainly influences sales prices for goods and services or the country whose competitive forces and regulations most affect the entity's performance.

Cost of Sales

The direct costs attributable to the production of the goods sold by a company.

Economic Exposure

The risk that a company's cash flow, earnings, or future cash flows will be affected by changes in exchange rates.

Monetary Items

Assets and liabilities that are to be received or paid in a fixed or determinable amount of money.