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1. Calculate the Sharpe Ratio for the portfolio below. Assume a risk free rate of 1.5%. Assume log returns so that you do not have

1. Calculate the Sharpe Ratio for the portfolio below. Assume a risk free rate of 1.5%. Assume log returns so that you do not have to worry about issues with compounding. (Answer in decimals to the nearest third decimal, so 0.000)

Year

Return

1

-1.80%

2

3.50%

3

7.20%

4

-11.60%

5

19.50%

6

6.00%

2.

Calculate the Sharpe Ratio for the portfolio below. Assume a risk free rate of 1.5%. Assume log returns so that you do not have to worry about issues with compounding. (Answer in decimals to the nearest third decimal, so 0.000)

Year

Return

1

3.50%

2

5.50%

3

7.50%

4

1.30%

5

6.50%

6

8.10%

3.

An investment portfolio has an expected return of 6.5% and a standard deviation of returns of 7.5%. The risk free rate is 2.5%. What has the biggest impact on the portfolios Sharpe Ratio?

Group of answer choices

a. A 0.75% (linear) increase in the expected return

b. A 1.00% (linear) decrease in the risk free rate

c. A 1.00% (linear) decrease in the standard deviation

d. Not enough information is given.

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