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An investor has a coefficient of absolute risk aversion equal to 1. Assuming a quadratic utility function with a scaling of 0.5, the utility she
An investor has a coefficient of absolute risk aversion equal to 1. Assuming a quadratic utility function with a scaling of 0.5, the utility she would get from investing in an asset with a return of 3.5% and a standard deviation of 4% is:
(a) 0.75%
(b) 1.5%
(c) 1.71%
(d) 3.42%
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