To determine the portfolios' levels of risk from lowest to highest based on their investment amounts, we first need to sum the total values of each portfolio. Here's how we do this step-by-step:
1. Calculate the total investment for Portfolio 1:
[tex]\[
\$1,800 + \$600 + \$1,100 + \$500 + \$1,700 = \$5,700
\][/tex]
2. Calculate the total investment for Portfolio 2:
[tex]\[
\$2,200 + \$1,200 + \$3,500 + \$1,300 + \$4,200 = \$12,400
\][/tex]
3. Calculate the total investment for Portfolio 3:
[tex]\[
\$400 + \$5,500 + \$1,200 + \$3,000 + \$600 = \$10,700
\][/tex]
Now, we compare the total investment amounts to determine the risk levels. A higher total investment amount indicates a hypothetically higher level of risk.
- Portfolio 1 Total: \[tex]$5,700
- Portfolio 2 Total: \$[/tex]12,400
- Portfolio 3 Total: \[tex]$10,700
From lowest to highest:
1. Portfolio 1 has the lowest total value of \$[/tex]5,700.
2. Portfolio 3 follows with a total value of \[tex]$10,700.
3. Portfolio 2 has the highest total value of \$[/tex]12,400.
Thus, the portfolios' levels of risk from lowest to highest are:
Portfolio 1, Portfolio 3, Portfolio 2.
