Quantitative Ability (Part 4 of 9)

Directions: Answer these questions on the basis of the information given below:

Shabnam is considering three alternatives to invest her surplus cash for a week. She wishes to guarantee maximum returns on her investment. She has three options, each of which cart be utilized fully or partially in conjunction with others.

Option A: Invest in a public sector bank. It promises a return of + 0.10%.

Option B: Invest in mutual funds of ABC Ltd. A rise in the stock market will result in a return of + 5%, while a fall will entail a return of-3%.

Option C: Invest in mutual funds of CBALtd. Arise in the stock market will result in a return of-2.5%, while a fall will entail a return of + 2%.

  1. The maximum guaranteed return to Shabnam is

    1. 0.30%

    2. 0.25%

    3. 0.10%

    4. 0.20%

    5. 0.15%

    Answer: d

  2. What strategy will maximize the guaranteed return to Shabnam?

    1. 30% in option A, 32% in option B and 38% in option C

    2. 100% in option A

    3. 36% in option B and 64% in option C

    4. 64% in option B and 36% in option C

    5. ⅓ in each of the three options

    Answer: c