7. Suppose that the risk-free asset from the previous problem has a gauranteed return of 2%. Further suppose that I have exponential utility with = 0.001 and my current level of wealth is $1000. (a) Assume that the volatility of the risky nsset is 15% and that I am not able to diversify. For what values of pi would I choose the risky asset over the risk-free asset. (b) Repeat your calculation from (a) assuming volatility is 30%, and comment on any difference. (e) Assume that the expected return on the risky asset is 7% and that I am not able to diversify. For what values of a would I choose the risky asset over the risk-free asset? (d) Repeat your calculation from (e) assuming the expected return is 12%, and comment on any difference. 7. Suppose that the risk-free asset from the previous problem has a gauranteed return of 2%. Further suppose that I have exponential utility with = 0.001 and my current level of wealth is $1000. (a) Assume that the volatility of the risky nsset is 15% and that I am not able to diversify. For what values of pi would I choose the risky asset over the risk-free asset. (b) Repeat your calculation from (a) assuming volatility is 30%, and comment on any difference. (e) Assume that the expected return on the risky asset is 7% and that I am not able to diversify. For what values of a would I choose the risky asset over the risk-free asset? (d) Repeat your calculation from (e) assuming the expected return is 12%, and comment on any difference