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Consider historical data showing that the average annual rate of return on the S&P 500 portfolio over the past 85 years has averaged roughly 8%

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Consider historical data showing that the average annual rate of return on the S&P 500 portfolio over the past 85 years has averaged roughly 8% more than the Treasury bill return and that the S&P 500 standard deviation has been about 35% per year. Assume these values are representative of Investors' expectations for future performance and that the current T-bill rate is 3%. Calculate the utility levels of each portfolio for an investor with A-2. Assume the utility function is ) - 0.8 m. (Do not round Intermediate calculations, Round your answers to 4 decimal places. Negative amounts should be indicated by a minus sign. Windex U(A-2) WBills 0.0 0.2 0.4 0.5 0.8 10 1.0 0.8 06 04 02 00

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