b.

Assume that you manage a risky portfolio with an expected rate of return of 15% and a standard deviation of 29%. The T-bill rate is 5% A client prefers to invest in your portfolio a proportion () that maximizes the expected return on the overall portfolio subject to the constraint that the overall portfolio's standard deviation will not exceed 20% a. What is the investment proportion, y? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Investment proportion y 68.97% b. What is the expected rate of return on the overall portfolio? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Rate of return If the real interest rate is 3.00% per year and the expected inflation rate is 2.40%, what is the nominal interest rate according to the Fisher equation? (Round your answer to 2 decimal places.) Nominal interest rate