You own a portfolio that is invested 38 percent in Stock A,43 percent in Stock B,and the remainder in Stock C.The expected returns on these stocks are 10.9 percent,15.4 percent,and 9.1 percent,respectively.What is the expected return on the portfolio?
A)10.55 percent
B)11.02 percent
C)11.67 percent
D)12.49 percent
E)13.05 percent

Question

Quizplus · Accepted Answer

Expected return = [0.38 × 0.109] + [0.43 × 0.154] + [(1 - 0.38 - 0.43) × 0.091] = 12.49 percent

You Own a Portfolio That Is Invested 38 Percent in Stock