You’re 30 years old. Using the allocation rule described in Section 11.3.3, how much should you be allocating to stocks, bonds, and cash, respectively?

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11.3.3 Risk Premiums As we've seen, investors require a premium to be willing to bear risk. An easy way to think about the relationship between risk and return is that investors will require a certain amount of return, or a risk premium, for each type of risk to which they're exposed. For debt securities, these may include inflation risk, interest-rate risk, reinvestment risk, default risk, liquidity risk, and market risk. Equity investments expose you primarily to inflation risk, reinvestment risk, and market risk. An investment with more of these components of risk will generally provide a greater level of return than one that has very few. The types of risk are: Inflation Risk. Even if an investment were virtually risk-free, you'd require compensation for delaying consumption. With most investments, you'll also be exposed to inflation risk-the loss in spending power over the investment period. Thus, the minimum rate of return you'd expect from any investment would include compensation for delaying consump- tion and for bearing inflation risk. This minimum rate of return is usually called the nominal risk-free rate-a rate that is higher during periods of rising inflation than during periods of low inflation. The shortest-term debt security issued by the federal government, a 13-week Treasury bill, is an investment that is expected to earn the nominal risk-free rate since it doesn't expose you to any of the other types of risk discussed below. Inflation risk normally increases with the term to maturity, so a one-year ctivate Treasury bill will have a slightly larger inflation-risk premium than a 13-week Treasury bill. Go to Settim