Question : 21.What the average return of a portfolio that has 45% : 1404055

 

 

21.What is the average return of a portfolio that has 45% invested in stock A, 35% invested in stock B and the rest invested in stock C?

a.9.92%

b.11.62%

c.10.62%

d.12.48%

 

 

 

22.Bavarian Sausage stock has an average historical return of 16.3% and a standard deviation of 5.3%. In which range do you expect the returns of Bavarian Sausage 95% of the time.

 

 

 

 

23.Bavarian Sausage stock has an average historical return of 16.3% and a standard deviation of 5.3%. In which range do you expect the returns of Bavarian Sausage 68% of the time.

a.5.7%:26.9%

b.5.3%:16.3%

c.11.0%:21.6%

d.6.2%:18.5%

 

 

 

24.Bavarian Sausage stock has an average historical return of 16.3% and a standard deviation of 5.3%. What is the probability that the return on Bavarian Sausage will be less than 11%?

a.84%

b.50%

c.16%

d.32%

 

 

 

25.Bavarian Sausage stock has an average historical return of 16.3% and a standard deviation of 5.3%. What is the probability that the return on Bavarian Sausage will be higher than 26.9 %?

a.5%

b.2.5%

c.16%

d.95%

 

 

 

 

26.Which of the following is not part of the procedure for valuing a risky asset?

a.determining the asset’s expected cash flows

b.choosing a discount rate that reflects the asset’s risk

c.calculating the present value

d.determining whether the project is mutually exclusive or not

 

 

 

27.The total return of an asset captures

a.income paid by an asset over time.

b.the capital gain or loss on the asset over time.

c.the book value of the asset over time.

d.a and b are both correct.

 

 

 

28.If you were to purchase an asset for $100 today and receive a dividend of $5 at the end of the year in addition to selling the asset for $110, then what would the capital gain on the asset be?

a.15%

b.10%

c.5%

d.none of the above

 

 

 

29.You purchased a 10-year, 6% coupon bond (the bond makes semi-annual payments) last year based upon a discount rate of 6%. One year later the discount rate has fallen to 5.5%. What is your total return on the bond?

a.6.000%

b.3.512%

c.9.512%

d.none of the above

 

 

 

 

 

 

 

30.You purchased WPC common shares for $50 one year ago. You have received total dividends equal to $8 during the year. If your total return during the period is 12%, then what was the price of WPC when you sold the stock today?

a.$52.00

b.$48.00

c.$98.00

d.none of the above