Don has $3,000 invested in AT&T with an expected return of 11.6 percent; $10,000 in IBM with an expected return of 12.8 percent; and $6,000 in GM with an expected return of 12.2 percent. What is Don's expected return on his portfolio?

A) 12.42%
B) 12.20%
C) 11.81%
D) Cannot be determined

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Worth Living · Accepted Answer

Final Answer : A, Explanation :  The expected return on Don's portfolio can be calculated by taking the weighted average of the expected returns of the individual investments. The calculation is as follows: [(3,000 * 11.6%) + (10,000 * 12.8%) + (6,000 * 12.2%)] / (3,000 + 10,000 + 6,000) = 12.42%.

Don has $3,000 invested in AT&T with an expected return of 11.6 percent; $10,000 in IBM with an expected return of 12.8 percent; and $6,000 in GM with an expected return of 12.2 percent. What is Don's expected return on his portfolio?

A) 12.42%
B) 12.20%
C) 11.81%
D) Cannot be determined

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Learning Objectives

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Don has $3,000 invested in AT&T with an expected return of 11.6 percent; $10,000 in IBM with an expected return of 12.8 percent; and $6,000 in GM with an expected return of 12.2 percent. What is Don's expected return on his portfolio?A) 12.42%B) 12.20%C) 11.81%D) Cannot be determined

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Learning Objectives

Learning Objectives

Related questions

Don has $3,000 invested in AT&T with an expected return of 11.6 percent; $10,000 in IBM with an expected return of 12.8 percent; and $6,000 in GM with an expected return of 12.2 percent. What is Don's expected return on his portfolio?

A) 12.42%
B) 12.20%
C) 11.81%
D) Cannot be determined