PORTFOLIO MANAGEMENT- QUESTIONS WITH ANSWERS.



C - Answer-A portfolio has the following returns:



 Portfolio Returns

2006 2.4

2007 9.6

2008 4.0

2009 5.6

2010 4.8

2011 3.2

The sample variance of the portfolio is closest to:



A. 0.23%.

B. 0.36%.

C. 0.28%.



B - Answer-When considering a portfolio that is optimal for one investor, a second investor with a higher risk aversion would most likely:



A. expect a higher variance for the portfolio.

B. derive a lower utility from the por...