THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION

THE NEXT QUESTIONS ARE BASED ON THE FOLLOWING INFORMATION:
Investment A has an expected return of 8% with a standard deviation of 2.5%.Investment B has an expected return of 6% with a standard deviation of 1.2%.Assume you invest equally in both investments and that the rates of return are independent.
-What is the standard deviation of the return on your portfolio? Assume that the returns on the two investments are independent.

A) 2.77
B) 2.50
C) 7.69
D) 6.25

Correct Answer:

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