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Assume that the risk-free rate of return is 3 percent and the market portfolio on the Capital Market Line (CML) has an expected return of

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Assume that the risk-free rate of return is 3 percent and the market portfolio on the Capital Market Line (CML) has an expected return of 11 percent and a standard deviation of 14 percent. How should you invest $100,000 if you are only willing to accept a total portfolio risk of 8 percent? Select one: O a invest $140,000 in the market portfolio and by borrowing $40,000 at the risk-free rate b. invest $57,134 in the market portfolio and the remainder in the risk-free security O c. invest $36,363.64 in the market portfolio and the remainder in the risk-free security d. invest $63,636.36 in the market portfolio and the remainder in the risk-free security

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