A risky portfolio has an expected return of 18% and a standard deviation of 20%. Short-term T-bills have a return of 7%. An investor has $5,000 to invest and needs to decide between investing in the risky portfolio and T-bills. Suppose that the investor has the utility function U = E(rp) - ( A 2) and a risk-aversion parameter of A = 1.2.

A) What is the utility of the risky portfolio for the investor?

B) What is the utility of the T-bills for the investor?