Question
15 . A margin user has a situation where the riskfree rate is 6% and the risky portfolio has an expected return of 12% with
15. A margin user has a situation where the riskfree rate is 6% and the risky portfolio has an expected return of 12% with a standard deviation of 15%. If the proportion in risky portfolio is 1.8, the expected return is: (a) 14.6%. (b) 19.2%. (c) 21.6%. (d) 16.8%. 16. A margin user has a proportion 1.3 invested in the risky portfolio that has .4 in A with an expected return of 14%, .6 in B with an expected return of 18%. If the riskfree rate is 5%, her expected return is (a) 21.3%. (b) 16.4%. (c) 19.8%. (d) 18.2%.
Please answer #15 & #16 in detail. I think the answers are D 16.8 for #15 and and C 19.8 for #16 but I need full detailed explanation
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