ake a Test - Jared Myers Microsoft Edge mathxl.com/Student/PlayerTest.aspx?testi

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ake a Test - Jared Myers Microsoft Edge mathxl.com/Student/PlayerTest.aspx?testid-172520384&enter; vin-yes FIN305.NO1-Fall 2017 Jared Myers 1 1/3/17 3:03 Pr Time Remaining: 00:49:12 Submit Qu This Quiz: 12 pts possib Quiz: Bonus Quiz 3FA This Question: 1 pt 4 of 12 (3 complete) Suppose that you hold a two-asset portfolio consisting of 100 shares of Clooney Brothers at $33 per share and 100 shares of Marx Brothers at $42 per share. Assume that you have computed the expected return on Clooney Brothers and Marx Brothers to be 20% and 12%, respectively whats the expected return rom the portfolio? OA, 15 5% OB. 135% OC. 120% OD, 200% OE. 160% Type here to

Explanation / Answer

Correct option A 15.5%

Portfolio No. of shares Price per share Total Share price Rate increase New share price New Total Share price a b c= a*b d e= b*(1+d) f=e*a Colony brothers 100 $ 33 $ 3,300 20% $ 39.60 $        3,960.00 Marx brothers 100 $ 42 $ 4,200 12% $ 47.04 $        4,704.00 $     7,500.00 $        8,664.00 Total Return = (8664-7500)/7500 15.52%

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