To select: Thereal estate return of which property affects the portfolio risk is to be determined . Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment. The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance. s t a n d a r d d e v i a t i o n = v a r i a n c e The expected return is defined as the return which is obtained on the risky asset that is expected in future. Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

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Answer 1

Question

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

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Answer 2

Question

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

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Answer 3

Question

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

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Answer 4

Question

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

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Answer 5

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

Answer 6

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

Answer 7

Chapter 7, Problem 2PS

Summary Introduction

To select: Thereal estate return of which property affects the portfolio risk is to be determined.

Introduction : The portfolio risk is defined as the combination of assets which carries its own risk with each investment.

The standard deviation is used to determine that in which manner the values from a data set vary from its mean value. This is calculated by the square root of the variance.

standard deviation=variance

The expected return is defined as the return which is obtained on the risky asset that is expected in future.

Correlation represents the relation between the two data sets. It shows that in which manner it corresponds to the changes in the value of alternate set. When the one data is increased and along with other is also increasing or vice-versa, then it is called as positive Correlation.

Answer 8

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Answer 9

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Answer 10

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Answer 11

Ch. 7 - Prob. 1PS Ch. 7 - Prob. 2PS Ch. 7 - Prob. 3PS Ch. 7 - Prob. 4PS Ch. 7 - Prob. 5PS Ch. 7 - Prob. 6PS Ch. 7 - Prob. 7PS Ch. 7 - Prob. 8PS Ch. 7 - Prob. 9PS Ch. 7 - Prob. 10PS

Solution Summary: The author explains that the portfolio risk is affected by the real estate return of a property which can be stock, bond and cash.

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