# Question

A portfolio consists of assets with the following expected returns:

Technology stocks........... 20%

Pharmaceutical stocks....... 15

Utility stocks........... 10

Savings account........... 5

a. What is the expected return on the portfolio if the investor spends an equal amount on each asset?

b. What is the expected return on the portfolio if the investor puts

50 percent of available funds in technology stocks, 10 percent in pharmaceutical stocks, 24 percent in utility stocks, and 16 percent in the savings account?

Technology stocks........... 20%

Pharmaceutical stocks....... 15

Utility stocks........... 10

Savings account........... 5

a. What is the expected return on the portfolio if the investor spends an equal amount on each asset?

b. What is the expected return on the portfolio if the investor puts

50 percent of available funds in technology stocks, 10 percent in pharmaceutical stocks, 24 percent in utility stocks, and 16 percent in the savings account?

## Answer to relevant Questions

Consider a $30,000 portfolio consisting of three stocks. Their values and expected returns are as follows: What is the weighted-average expected return on the portfolio? Stock A has a risk premium of 6.5 percent. If Treasury bills yield 6.2 percent and the expected return on the market is 10.5 percent, what is the stockâ€™s beta coefficient? A firm has earnings of $12,000 before interest, depreciation, and taxes. A new piece of equipment is installed at a cost of $10,000. The equipment will be depreciated over five years, and the firm pays 25 percent of its ...You prefer to extend credit on the assumption that you will be paid in full within 30 days of the sales. Firm X has average inventory of $600,000 with all cash sales (no credit sales) of $6,000,000. If you extend credit to ...The dividend-growth model may be used to value a stock: V= D0 (1 + g) / k - g a. What is the value of a stock if: D0 = $2 k = 10% g = 6% b. What is the value of this stock if the dividend is increased to $3 and the other ...Post your question

0