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Consider an investment that pays off $900 or $1,500 per $1,000 invested with equal probability. Suppose you have $1,000 but are willing to borrow to
Consider an investment that pays off $900 or $1,500 per $1,000 invested with equal probability. Suppose you have $1,000 but are willing to borrow to increase your expected return. What would happen to the expected value and standard deviation of the investment if you borrowed an additional $1,000 and invested a total of $2,000? What if you borrowed $2,000 to invest a total of $3,000? Instructions: Fill in the table below to answer the questions above. Enter your responses as whole numbers and enter percentage values as percentages not decimals (i.e., 20% not 0.20). Enter a negative sign (-) to indicate a negative number if necessary. Invest $1,000 Invest $2,000 Invest $3,000 Expected Value Percent Increase Standard Deviation $ $ % $ Expected Return N/A (Click to select) (Click to select)
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