Multiple Choice
Use the table below to answer the following question(s) .
Below is the spreadsheet for a portfolio allocation model.
![Use the table below to answer the following question(s) . Below is the spreadsheet for a portfolio allocation model. Assume that the distributions of life insurance annual return is uniform distribution with minimum 4% and maximum 6%, bond mutual funds annual return is normal with mean 7% and standard deviation 1%, stock mutual funds annual return is lognormal with mean 11% and standard deviation 4%. -What is the coefficient of variation obtained from the simulation results for maximizing the total expected return? [Hint: Choose the approximate value.] A) 1.2451 B) 0.4865 C) 0.8917 D) 0.1268](https://d2lvgg3v3hfg70.cloudfront.net/TB3611/11ea30b2_921f_544c_b0fd_25a805260963_TB3611_00_TB3611_00_TB3611_00_TB3611_00_TB3611_00.jpg)
Assume that the distributions of life insurance annual return is uniform distribution with minimum 4% and maximum 6%, bond mutual funds annual return is normal with mean 7% and standard deviation 1%, stock mutual funds annual return is lognormal with mean 11% and standard deviation 4%.
-What is the coefficient of variation obtained from the simulation results for maximizing the total expected return? [Hint: Choose the approximate value.]
A) 1.2451
B) 0.4865
C) 0.8917
D) 0.1268
Correct Answer:
Verified
Correct Answer:
Verified
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