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Consider an agent with DARA preferences. Suppose he only has access to a financial market with 5 risky assets. He chooses his optimal allocation, (w1,

Consider an agent with DARA preferences. Suppose he only has access to a financial market with 5 risky assets. He chooses his optimal allocation, (w1, W2, W3, W4,w5). Suppose now he becomes poorer. Would the weights (W1, W2, W3, W4,w5) change? Suppose, now, that asset 5 can be considered as a risk-free asset. Would your answer change?

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