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11 - Consider the following data for assets A and B : RA=12%;RB=8%;A=10%;B=4%;AB=1.0 a. If only assets A and B are available, draw the efficient
11 - Consider the following data for assets A and B : RA=12%;RB=8%;A=10%;B=4%;AB=1.0 a. If only assets A and B are available, draw the efficient frontier. b. Now assume the assumptions of CAPM hold. If the riskless lending and borrowing rate is 10%, is this situation (i.e., existence of asset b, for example) is an equilibrium or a disequilibrium situation? Why? If this is a disequilibrium situation, what is the arbitrage opportunity that will restore equilibrium
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