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1. A condpeutave portitio has an espoceed return of 6.25 and samdard deviation of scerion Ci Calcutation Troblicars 7.5e. T. Bills has a return of
1. A condpeutave portitio has an espoceed return of 6.25 and samdard deviation of scerion Ci Calcutation Troblicars 7.5e. T. Bills has a return of 356 and standard deviation of 0%. Dow Jones ladex has an expected retum of 10%5 and standard deviation of 15%. If you are willing to make your own portfolio with a standard deviation of 8%, the portfolio consists of raky and risk-free asset. a. What is the weight in the risky asset and the risk free usset? [2 marks] b. What is the expected return of your portolio? [2 marks| c. If you want to decrease your portfolio risk, would you suggest to increase or decrease your weight in T.Bills. [2 marks]
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