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8. You are a portfolio advisor creating a complete portfolio for a client. The client has a risk aversion (A) of 5. You have decided

image text in transcribed 8. You are a portfolio advisor creating a complete portfolio for a client. The client has a risk aversion (A) of 5. You have decided to create a portfolio using two risky assets: Asset A and Asset B. Asset A has an expected return of 10% and a risk of 19%. Asset B has an expected return of 5% and a risk of 8%. The correlation between the two assets' returns is 0.20 . Using a risk free rate of 3%, you have determined that the optimal risky portfolio is 40% in Asset A and 60\% in Asset B. a. Solve for the expected return and risk of the optimal risky portfolio created using Asset A and Asset B. b. Solve for the weight in the optimal risky portfolio and risk free asset. c. What is the expected return and risk of the client's complete portfolio? d. What is the Sharpe ratio of the complete portfolio and the optimal risky portfolio

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