You own a portfolio that has $2,000 invested in Stock A and $3,500 invested in Stock B.The expected returns on these stocks are 14 percent and 9 percent,respectively.What is the expected return on the portfolio?
A) 10.06 percent
B) 10.50 percent
C) 10.82 percent
D) 11.13 percent
E) 11.41 percent

Question

Quizplus · Accepted Answer

E(R_p) = [$2,000/($2,000 + $3,500)] [0.14] + [$3,500/($2,000 + $3,500)] [0.09] = 10.82 percent

You Own a Portfolio That Has $2,000 Invested in Stock