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CAT 2007 | Question: 06

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Directions for below question:

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 can 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 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 CBA Ltd. A rise in stock market will result in a return of $-2.5\%,$ while a fall will entail a return of $-+2\%.$

The maximum guaranteed return to Shabnam is

  1. $0.25\%$
  2. $0.10\%$
  3. $0.20\%$
  4. $0.15\%$
  5. $0.30\%$

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