An investor puts up $5,000 and borrows an equal amount of money from his broker to double the amount invested to $10,000. The broker charges 5% on the loan. The stock was originally purchased at $20 per share, and in 1 year the investor sells the stock for $25. The investor's rate of return was 25% 40% 12% 45% A loan for a new car costs the borrower 1% every month. What is the effective annual rate (EAR)? 12.68% 10.23% 8.24% 6.78% Your complete portfolio is 40% invested in a risky asset and 60% invested in a Treasury bill (the risk-free asset). The risky asset has an expected rate of return of 20% and a standard deviation of 15% and the Treasury bill has a rate of return of 6%. The Sharpe ratio of your complete portfolio is approximately 1.05 0.50 0.34 0.93 You have $100,000 available to invest. The risk-free rate, as well as your borrowing rate, is 5%. The risky portfolio has an expected return of 15% and a return standard deviation of 25%. If you want the standard deviation of your investment to be 35%, you must borrow $50,000 at the risk-free rate borrow $40,000 at the risk-free rate invest $60,000 in the risk-free asset invest $20,000 in the risk-free asset