Question $14$

$6$ pts

On the basis of how long she has until retirement and her comfort with investment risk, Chelsea has decided that she wants to allocate the money in her retirement account as follows: $75\%$ to equities, $20\%$ to fixed income, and $5\%$ to cash. If Chelsea assumes that each asset class earns the low end of the historical average rates of return provided below, what overall rate of return would she expect to earn over the long term?

Equities: $8\%-12\%$

Fixed Income: $4\%-7\%$

Cash: $2\%-5\%$

$6\mathrm{.}90\%$

$5\mathrm{.}60\%$

$10\mathrm{.}65\%$

$7\mathrm{.}75\%$

$4\mathrm{.}67\%$