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1.Two portfolios (A and B) are created with different allocations to the market portfolio and the risk-free asset, and have respective expected returns of 6%

1.Two portfolios (A and B) are created with different allocations to the market portfolio and the risk-free asset, and have respective expected returns of 6% and 15%.The expected return on the market is 12%, the risk-free rate is 1%.

a.How is each portfolio allocated (in percentage terms) between the market portfolio and the risk-free asset?

b.Given that the standard deviation of the return on the market is 15%, what is the standard deviation of the return on each of the two portfolios?

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