Question
You own a portfolio that has 2,072 shares of stock A, which is priced at $19.70 per share and has an expected return of 12.11%,
You own a portfolio that has 2,072 shares of stock A, which is priced at $19.70 per share and has an expected return of 12.11%, and 3,577 shares of stock B, which is priced at $8.90 per share and has an expected return of 5.81%. The risk-free return is 3.90% and inflation is expected to be 2.17%. What is the expected real return for your portfolio?
A rate less than 6.14% or a rate greater than 20.14%
A rate equal to or greater than 6.14% but less than 8.19%
A rate equal to or greater than 9.93% but less than 13.73%
A rate equal to or greater than 8.19% but less than 9.93%
A rate equal to or greater than 13.73% but less than 20.14%
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