Assume the optimal weights for a risk portfolio of stocks and bonds is 50% stocks and 50% bonds and that this portfolio has an expected return of 10% and an expected standard deviation of 12%. Assume the expected risk-free rate is 2%, the yield curve is flat and the expected market risk premium is 8%.

1. What is your complete portfolio percentage allocation to stocks, bonds, and cash needed to achieve a 6% return?

2. What is the expected standard deviation associated with a 6% return?

3. What is your complete portfolio percentage allocation to stocks, bonds, and cash needed to achieve a 4% standard deviation?

4. What is the expected return associated with a 4% standard deviation?

5. What is the Sharpe ratio of each portfolio?