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Exhibit 6.10 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Asset (A) Asset (B) E(R A ) = 16% E(R B ) = 14% (
Exhibit 6.10
USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S)
Asset (A) | Asset (B) |
E(RA) = 16% | E(RB) = 14% |
(A) = 3% | (B) = 8% |
WA = 0.5 | WB = 0.5 |
COVA,B = 0.0014
|
Refer to Exhibit 6.10. What is the expected return of a portfolio of two risky assets if the expected return E(Ri), standard deviation ( i ), covariance (COVi,j), and asset weight (Wi) are as shown above?
a. | 14% | |
b. | 12% | |
c. | 13% | |
d. | 15% | |
e. | 11% |
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