NO.PZ202212280100004701
问题如下：
A. Select, for each of Armstrong’s three goals, which sub- portfolio module from Exhibit 1 Abbott should choose in constructing a portfolio. Justify each selection.
选项：
解释：
• Module C should be chosen for Goal 1, Module B should be chosen for Goal 2, and Module D should be chosen for Goal 3.
• The module that should be selected for each goal is the one that offers the highest return given the time horizon and required probability of success.
The module that should be selected for each goal is the one that offers the highest return given the time horizon and required probability of success. For Goal 1, which has a time horizon of five years and a required probability of success of 85%, Module C should be chosen because its 4.4% expected return is higher than the expected returns of all the other modules. Similarly, for Goal 2, which has a time horizon of 10 years and a required probability of success of 99%, Module B should be chosen because its 2.2% expected return is higher than the expected returns of all the other modules. Finally, for Goal 3, which has a time horizon of 25 years and a required probability of success of 75%, Module D should be chosen because its 7.5% expected return is higher than the expected returns of all the other modules.
C for goal 1, A for goal 2, D for goal 3.
Because C offers the highest return at 85% chance of purchasing a vacation home for $5 million in five years.
Because A offers the highest return at a 99% chance of being able to maintain their current annual expenditures of $100,000 for the next 10 years, assuming annual inflation of 3% from year 2 onward.
Because D offers highest return at a 75% chance of being able to donate $10 million to charitable foundations in 25 years.
