What is the expected return on a portfolio that is equally weighted between stocks K and L given the following information?
A)11.13 percent
B)11.86 percent
C)12.25 percent
D)13.32 percent
E)14.40 percent

Name: What is the expected return on a portfolio that is equally weighted between stocks K and L given the following information? A)11.13 percent B)11.86 percent C)12.25 percent D)13.32 percent E)14.40 percent
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Question

What is the expected return on a portfolio that is equally weighted between stocks K and L given the following information? 
A)11.13 percent 
B)11.86 percent 
C)12.25 percent 
D)13.32 percent 
E)14.40 percent

Quizplus · Accepted Answer

E(r) = 0.25[(0.16 + 0.13)/2] + 0.75[(0.12 + 0.08)/2] = 11.13 percent

What Is the Expected Return on a Portfolio That Is