this is one question with two parts, could you have it answered please 4. Assume that you have a portfolio of two stocks, X and Y. If the risk of stock X is 1.2 and the riskof stock Y is 4, then the return on stock Y should bea) Greater than the return on Stock Xb) We cannot tellc) Less than the return on stock Xd) Equal to the return on stock S5. If the portfolio in the previous question is well diversified and stocks are strongly negativelyrelated, then the risk for the portfolio will bea) Greater than the risk of stock X (i.e. greater than 1.2) but less than the risk on stock Y(i.e lessthan 4)b) We cannot tellc) Greater than the risk of stock Y (i.e. greater than 4)d) Less than the risk of stock X (i.e. less than 1.2)

4) For a rational investor, if risk is higher investor demands greater return.

Assume that you have a portfolio of two stocks, X and Y. If the risk of stock X is 1.2 and the risk of stock Y is 4, then the return on stock Y should be a) Greater than the return on Stock X b) We cannot tell c) Less than the return on stock X d) Equal to the return on stock S If the portfolio in the previous question is well diversified and stocks are strongly negatively related, then the risk for the portfolio will be a) Greater than the risk of stock X (i.e. greater than 1.2) but less than the risk on stock Y(i.e less than 4) b) We cannot tell c) Greater than the risk of stock Y (i.e. greater than 4) d) Less than the risk of stock X (i.e. less than 1.2)

Assume that you have a portfolio of two stocks, X and Y. If the risk of stock X is 1.2 and the risk of stock Y is 4, then the return on stock Y should be a) Greater than the return on Stock X b) We cannot tell c) Less than the return on stock X d) Equal to the return on stock S If the portfolio in the previous question is well diversified and stocks are strongly negatively related, then the risk for the portfolio will be a) Greater than the risk of stock X (i.e. greater than 1.2) but less than the risk on stock Y(i.e less than 4) b) We cannot tell c) Greater than the risk of stock Y (i.e. greater than 4) d) Less than the risk of stock X (i.e. less than 1.2)

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter2: Risk And Return: Part I

Section: Chapter Questions

Problem 9MC

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