ECO 2010 INCLUSIVE ACCESS
21st Edition
ISBN: 9781260564624
Author: McConnell
Publisher: MCGRAW-HILL HIGHER EDUCATION
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Question
Chapter 15, Problem 8DQ
To determine
R&D costs and the patent periods are related to each other.
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1. A pension fund manager is considering three mutual funds. The first is a stock fund, the
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money market fund that yields a rate of 8%. The probability distributions of the risky
funds have the following characteristics:
Standard Deviation (%)
Expected return (%)
Stock fund (Rs) 20
30
Bond fund (RB) 12
15
The correlation between the fund returns is .10.
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