Answered step by step

Verified Expert Solution

Link Copied!

Question

1 Approved Answer

Posted on Aug 13, 2024

You invest 60 percent of your funds in stock A and the balance in stock B. The standard deviation of returns on A is 10

You invest 60 percent of your funds in stock A and the balance in stock B. The standard deviation of returns on A is 10 percent, and on B, it is 20 percent. Calculate the variance of portfolio returns, assuming: (a) The correlation between the returns is 1.0. (b) The correlation is 0.5. (c) The correlation is 0.0 Round your answer to four decimal points

Step by Step Solution

There are 3 Steps involved in it

Step: 1

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

Step: 3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Management For Public Health And Not For Profit Organization

Authors: Steven A. Finkler

3rd International Edition

0138152772, 9780138152772

More Books

Students also viewed these Finance questions

Question

★★★★★

A firm has the following investment alternatives: Each investment costs $3,000; investments B and C are mutually exclusive, and the firms cost of capital is 8 percent. a. What is the net present...

Answered: 1 week ago

Question

★★★★★

For the following observational studies, indicate whether they are prospective or retrospective. a) A company looked at a sample of returned registration cards to estimate the income level of...

Answered: 1 week ago

Question

★★★★★

White Woods manufactures jewelry boxes. The primary materials (wood, brass, and glass) and direct labor are assigned directly to the products. Manufacturing overhead costs are allocated based on...

Answered: 1 week ago

Question

★★★★★

In your group discussion this week, respond to the following scenario: Bill Pei, CPA, is about to begin his audit of the accuracy of his client's accounts receivable. Based on experience, he expects...

Answered: 1 week ago

Question

★★★★★

3. Think of a small firm that makes a patent-protected heart stent, so that for the next decade it has an effective monopoly on the product. Demand is Q. = 300 - 1.58, and marginal cost rises with Q...

Answered: 1 week ago

Question

★★★★★

A 6 in. sch 40 pipeline carries a petroleum fraction (viscosity $15 \mathrm{cP}, \mathrm{SG} 0.85$ ) at a velocity of $7.5 \mathrm{ft} / \mathrm{s}$, from a storage tank at $1 \mathrm{~atm}$ pressure...

Answered: 1 week ago

Question

★★★★★

A 2 in. sch 40 pipe carries $\mathrm{SAE} 10$ lube oil at $100^{\circ} \mathrm{F}(\mathrm{SG}=0.928)$. The flow rate may be as high as $55 \mathrm{gpm}$, and you must select an orifice meter to...

Answered: 1 week ago

Question

★★★★★

Two items both have reorder points with service levels of 99%. One of the items is ordered 10 times a year, and the other item is ordered 20 times a year. Do these two items have the same overall...

Answered: 1 week ago

Question

★★★★★

(a) Find one more nonzero term for each of the solutions y 1 (x) and y 2 (x) in Example 8. (b) Find a series solution y(x) of the initial-value problem y'' + (cos x)y = 0, y(0) = 1, y'(0) = 1. (c)...

Answered: 1 week ago

Question

★★★★★

Draw a schematic diagram of I.C. engines and name the parts.

Answered: 1 week ago

Question

★★★★★

a. On the dominance continuum, place a mark where you feel she belongs.

Answered: 1 week ago

Question

★★★★★

b. On the sociability continuum, place a mark where you feel she belongs.

Answered: 1 week ago

Question

★★★★★

2. Evaluate how the original problem could have been intercepted before it became a health care crisis.

Answered: 1 week ago

Previous Question Next Question