Question

Question 5 (1 point) Calculate the expected return on a portfolio that contains 30% of a stock with an expected return of 3% and 70% of a stock with an expected return of 10%. (Enter your answer as a percentage rounded to 2 decimal places. For example, enter 1.53% instead of .0153.) Your Answer: Answer units Practi Q: Qu Question 6 (1 point) Saved Which one of the following terms best refers to the practice of investing in a variety of diverse assets as a means of reducing risk? retu zde A: See 1) Hedging O2) Diversification Type here to search

i keep getting these answer unit problems wrong, am I suppose to percent percent in the answer box and percent in the unit box? because the other way I keep missing problems

Answer 1

Answer

1) Expected return on the portfolio = 8%

Expected return = (w1 * r1)+(w2 * r2)

Where ,

w1=Weight of each investment in portfolio

r1=Rate of return on each investment in portfolio

	Weight	Expected return	Weighted average
Stock 1	30%	3%	1%
Stock 2	70%	10%	7%
			8%