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Use the following information to answer the next 2 questions: Asset A Asset B Amount invested 8,000 12,000 Expected Return 12.50% 8.50% Standard Deviation 5.00%
Use the following information to answer the next 2 questions:
Asset A | Asset B | |
Amount invested | 8,000 | 12,000 |
Expected Return | 12.50% | 8.50% |
Standard Deviation | 5.00% | 3.80% |
Covariance | 0.00025 |
1) The expected return on the portfolio is:
10.50% | ||
8.75% | ||
12.50% | ||
10.10% | ||
11.27% |
2) The variance of the returns on the portfolio is:
.3500 | ||
0.0026 | ||
.0092 | ||
.0500 | ||
0.0010 |
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