1. Which of the following is not a true statement regarding the theoretical market portfolio?
a. All securities in the market portfolio are held in proportion to their market values
b. It includes all assets in the universe
c. It is the tangency point between the capital market line and the global minimum variance portfolio
d. It lies on the efficient frontier
2. Winston Enterprises would like to buy some additional land and build a new factory. The anticipated total cost is $152.43 million. The owner of the firm is quite conservative and will only do this when the company has sufficient funds to pay cash for the entire expansion project. Management has decided to save $560,000 a month for this purpose. The firm earns 6 percent compounded monthly on the funds it saves. How long does the company have to wait before expanding its operations? (Do not round intermediate calculations.)
136.10 months
1.172.24 months
2.169.88 months
3.223.91 months
4.272.20 months