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4) (25 points) Suppose that optimal risky portfolio has an expected return of 16% and a variance of 0.04. The risk-free rate is 4%. a)

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4) (25 points) Suppose that optimal risky portfolio has an expected return of 16% and a variance of 0.04. The risk-free rate is 4%. a) Find the slope of Capital Market Line (Optimal Capital Allocation Line)? b) What is the expected return of a portfolio C, which is on Capital Market Line and has a standard deviation of 0.08

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