The Expected Return on ZV Next Year Is 12% with a Standard

question 5

Multiple Choice

The expected return on ZV next year is 12% with a standard deviation of 20%. The expected return on TNA next year is 24% with a standard deviation of 30%. The correlation between the two stocks is -.6. If Hannah makes equal investments in ZV and TNA, what is the standard deviation of her portfolio?

• A) 22.47%.
• B) 12.04%
• C) 1.45%.
• D) 16.00%.

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Definitions:

Nature and Nurture

A debate concerning the relative importance of an individual's innate qualities ('nature') versus personal experiences ('nurture') in determining or causing differences in physical and behavioral traits.

Overweight Children

Children having a body mass index (BMI) at or above the 85th percentile for their age and sex, indicating they weigh more than is considered healthy.

Hypothesis

A proposed explanation or educated guess for a phenomenon, based on observations, that can be tested through experimentation or further observation.

Differential Susceptibility

suggests that people vary in their responsiveness to environmental influences, with some being more susceptible to both negative and positive contexts.