Consider the following information about a risky portfolio that you manage and a risk$-$free asset: $E(r_p)=12\%,{}_p=17\%,r_f=3\%.$

a$.$ Your client wants to invest a proportion of her total investment budget in your risky fund to provide an expected rate of return on her

overall or complete portfolio equal to $8\%.$ What proportion should she invest in the risky portfolio, $P,$ and what proportion in the risk$-$

free asset? $($Do not round intermediate calculations. Round your answer to $2$ decimal places.$)$

b$.$ What will be the standard deviation of the rate of return on her portfolio? $($Do not round intermediate calculations. Round your

answer to $2$ decimal places.$)$

Standard deviation

c$.$ Another client wants the highest return possible subject to the constraint that you limit his standard deviation to be no more than

$12\%.$ Which client is more risk averse?

First client

Second client