Answer:
The value is [tex]R = 20\%[/tex]
Step-by-step explanation:
From the question we are told that
The potential investment is [tex]i = \$ 5000[/tex]
The EMV of the portfolio is [tex]EMV = \$ 1000[/tex]
The standard deviation is [tex]\sigma = \$ 100[/tex]
Generally the rate of return is mathematically represented as
[tex]R = \frac{EMV}{i} * 100[/tex]
=> [tex]R = \frac{1000}{5000} * 100[/tex]
=> [tex]R = 20\%[/tex]
