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For the Following Three Questions, Assume That Rˉm=15%\bar { R } _ { m } = 15 \%

Question 1

Multiple Choice

For the following three questions, assume that: Rˉm=15%\bar { R } _ { m } = 15 \% , RˉA=13%\bar { R } _ { A } = 13 \% , RF=5%R _ { F } = 5 \% , σm=16%\sigma _ { m } = 16 \% , the market portfolio is a tangency portfolio, and that A is an efficient portfolio on the Capital Market Line.
-What would be the expected rate of return of portfolio A if its standard deviation was 32%?


A) 25%
B) 15%
C) 30%
D) 20%

Correct Answer:

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