Assume that stock market returns do not resemble a single-index structure. An investment fund analyzes 132 stocks in order to construct a mean-variance efficient portfolio constrained by 132 investments. They will need to calculate ____________ covariances.

A. 100
B. 132
C. 4,950
D. 8,646


D. 8,646

(n2 – n)/2 = (17,424 – 132)/2 = 8,646 covariances must be calculated.

Business

You might also like to view...

What bodily tendencies should a manager look for to detect dishonesty during the interview process?

a. lessened eye contact and increased blinking b. none, because they are not reliable c. lack of detail and pauses in responses d. odd breathing and sweating

Business

In which of the following ways does sexual harassment differ from sexual orientation discrimination?

a. There is no legal recourse for those suffering from sexual harassment. b. Sexual harassment may occur between same-level employees. c. There is no official federal protection against sexual harassment. d. Sexual harassment happens equally against men and women.

Business

All of the following are factors that may complicate capital investment analysis except:

A) the leasing alternative B) changes in price levels C) sunk cost D) the federal income tax

Business

Different activities in a global supply chain ______.

A. are of equal importance in the value they add B. may need to be traded--one against the other--to help managers prioritize C. can be avoided by doing all activities in-house D. none of these

Business