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(1 point) Consider a portfolio maturing in 3 months that consists of 9 shares of a risky stock and 8 units of a risk-free bond.

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(1 point) Consider a portfolio maturing in 3 months that consists of 9 shares of a risky stock and 8 units of a risk-free bond. Suppose that the stock's price is currently $140 per share, and, 3 months from now, its price will be either $120 or $160. Also, one bond unit is currently $50, and, 3 months from now, it will be worth $56. Determine each of the following. (a) The initial value of the portfolio = $ %3D (b) The maturity value of the portfolio (i) if the stock decreases in value = $ %3D (ii) if the stock increases in value = $ (c) As a percent to 2 decimals places, the effective annual rate of return (i) if the stock decreases in value = % compounded monthly (ii) if the stock increases in value = % compounded monthly

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