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a.) Which should you pick to add to the stock fund and the MM account, the bond fund or the REIT? Why? Show quantitatively
a.) Which should you pick to add to the stock fund and the MM account, the bond fund or the REIT? Why? Show quantitatively which choice is superior. b.) If your utility function is given by U =-.5A02, where denotes expected return and denotes standard deviation, what are the optimal portfolio weights on three assets in your complete portfolio (including the two risky assets you chose in (a) and the MM) for risk aversion A = 4.
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