1. Allison's portfolio has an expected return of? 14% and a beta of 1.37. ? Brianna's portfolio has an expected rate of return of? 11% and a beta of 1. The risk−free rate is? 3% and the expected rate of return on the market is? 12%. According to the? Jensen's measure,
A. the portfolios are equally desirable.
B. the answer depends on Allison and? Brianna's risk tolerance.
C. Brianna has the better portfolio.
D. Allison has the better portfolio.
2. The total risk associated with an investment can be divided into _____.
A. systematic and nondiversifiable risk
B. firm-specific and unsystematic risk
C. market and firm specific risk
D. market and nondiversifiable risk