The expected rate of return on a stock portfolio is a weighted average where the weights are based on the:
A) number of shares owned of each stock.
B) market price per share of each stock.
C) market value of the investment in each stock.
D) original amount invested in each stock.
E) cost per share of each stock held.

Question

Quizplus · Accepted Answer

The expected rate of return on a stock portfolio is best based on the market value of the investment in each stock as it takes into account both the number of shares owned and the market price per share of each stock. The original amount invested or the cost per share of each stock held may not accurately reflect the current value of the investment.

The Expected Rate of Return on a Stock Portfolio Is