Want of 15 A portfolio consists of only the market portfolio (with an expected return of 15.3% and a standard deviation of 15.2%) and the risk-free asset. The risk-free rate is 4.5%. If the target expected retum of this portfolio is 18%, what is the weight for the risk-free asset? % The weight for the risk-free asset is Note: Please retain at least 4 decimal places in your calculations and at least 2 decimal places in your final answer. Finish atte 7 Next page 5 of 15 Which of the following would be an example of unsystematic risk? 1. Overall consumer spending falls 2. High Tech Inc. announces its new products have been rejected by the govemment for launch 3. The government announces a new carbon tax policy for aircraft companies. O a 2 and 3 Ob. 2 only . 3 only Od 1 and 2 O e 1 only 8 Ned page 5 6 4 Unsure Previous page of 15 Which of the following statements is FALSE? O a. Most of unsystematic risk can be eliminated through diversification Ob. If assets are perfectly negatively correlated, the portfolio nisk will equal the weighted average d is constituent securities OC. The standard deviation is not the only measure of risk Od Systematic risk cannot be eliminated through diversification Finish attem O e Coefficient correlation shows a weaker relationship between the retums of to securities when ds absolute value is doser to 0. 9 Ned page Unsure Previous page 5 6 7 5 of 15 Use the following three statements to answer this question: 1. Risk means the probability that the actual return from an investment is less than the expected retum. 2. As long as PAB = -1, an equally weighted portfolio would be risk-free 3. If Covam >Covam, stock A moves more closely to the market portfolio (M) than stock B does. O a 1 and 3 O b. 1 only OC. all are incorrect Fid Od 1 and 2 Oe all are correct Unsure Previous page 6 7 8 9 10 Next page