An investor can design a risky portfolio based on two stocks, A and B. The standard deviation of return on stock A is 24%, while the standard deviation on stock B is 14%. The correlation coefficient between the returns on A and B is .35. The expected return on stock A is 25%, while on stock B it is 11%. The proportion of the minimum-variance portfolio that would be invested in stock B is approximately _________.
A. 45%
B. 67%
C. 85%
D. 92%
C. 85%
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If you saw your friend cheating on a test, you could tell the professor you witnessed the student cheating, but then you might feel guilty for betraying a friend. On the other hand, you could keep quiet, but you might feel bad allowing the cheater to gain an unfair advantage over you and the rest of the students in the class. This scenario stated in the textbook is an example of a/an
What will be an ideal response?
A formal ____________________ is a document that analyzes findings, draws conclusions, and makes recommendations intended to solve a problem
Fill in the blank(s) with correct word
Which of the following statements is correct about the risk-reward relationship of various types of risks?
A. Firm-specific risk is rewarded with additional returns. B. Default risk is rewarded with additional returns. C. Systematic risk is rewarded with additional returns. D. Unsystematic risk is rewarded with additional returns. E. Diversifiable risk is rewarded with additional returns.
In regression analysis, the ______ is the measure of the variation of the actual Y (independent variable) values around the mean Y (Y?).
a. total sum of squares (SST) b. error sum of squares (SSE) c. regression sum of squares (SSR) d. standard error of the estimate