FINANCE 215Sophia Finance Milestone 3a

FINANCE 215Sophia Finance Milestone 3a Anais purchased stock with an initial share price of $52, and sold it when the share price was $60. While she owned the stock, she earned $7 in dividends. What was her total percentage return on the investment? 13.33% 25.00% 28.85% 19.83% CONCEPT Understanding Returns 2 Which of the following is true of systematic risk? It is affected by the level of diversification within a portfolio. Research shows that investors can best mitigate this type of risk by holding ≤ 30 assets within a portfolio. It can be hedged against by choosing investments with negative correlations. It is the risk associated with a general downward turn of the market or a market segment. CONCEPT Diversification 3 A security that falls below the security market line has __________. a high expected return and a high price a low expected return and a low price a high expected return and a low price a low expected return and a high price CONCEPT Understanding the Security Market Line 4 You own a small manufacturing business that produces widgets. You have spent $600,000 acquiring the fixed assets you need to produce widgets. Each widget costs you $20 to make and they sell for $65 each, so your variable cost is 30.8% of the overall revenue. At your current level of operating leverage, how many widgets must you sell to break even?