Which is greatest increase in the portfolio-s sharpe ratio


A portfolio's expected return is 12%, its standard deviation is 20%, and the risk-free rate is 4%. Which of the following would make for the greatest increase in the portfolio's Sharpe ratio?

a. An increase of 1% in expected return.
b. A decrease of 1% in the risk-free rate
c. A decrease of 1% in its standard deviation.

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Basic Statistics: Which is greatest increase in the portfolio-s sharpe ratio
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