Jacob is holding an investment he bought for $1,000 that has a 60 percent chance of gaining $200 in value and a 40 percent chance of losing $40.Jacob's average expected rate of return on this investment is
A) 8 percent.
B) 10.4 percent.
C) 12.2 percent.
D) 24 percent.
Correct Answer:
Verified
Q66: Another name for nondiversifiable risk is
A)inflationrisk.
B)systemic risk.
C)cyclical
Q67: Nondiversifiable risk refers to potential losses from
A)random
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A)faced by a
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Q73: Another name for diversifiable risk is
A)systemic risk.
B)inflationrisk.
C)idiosyncratic
Q74: Investors diversify portfolios
A)because diversified portfolios pay the
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A)bond and stock rates of
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