A stock portfolio consists of four stocks. Stock A represents 20% of the portfolio and has a return of 6%. Stock B represents
30% of the portfolio and has a return of 8%. Stock C represents 20% of the portfolio and has a return of 4%. Stock D
represents the remaining 30% of the portfolio and has a negative-return of 5%. What is the average return of the portfolio?
A.
2.9%
B.
2.6%
C.
3.2%
D.
3.4%
Solution:
-