suppose you have $10,000.00 in cash and you decide to borrow another $10000.00 at 6% interest rate to invest in the stock market. you invest the entire $20,000.00 on an exchange-trade fund with a 11% expected return and a 20% volatility. what is your expected return on your investment?
total return = 11% of 20,000 - 6% of 10,0000 = 1600
expected return on investment = 1600/10000 = 16.00%
suppose you have $10,000.00 in cash and you decide to borrow another $10000.00 at 6% interest...
IN PERCENTAGES Suppose you have $10,000 in cash and you decide to borrow another $10,000 at a 7% interest rate to invest in the stock market. You invest the entire $20,000 in an exchange-traded fund (ETF) with a 10% expected return and a 20% volatility. The expected return on your of your investment is closest to:
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