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During the boom years of 2003-2007, ace mutual fund manager Diana Sauros, produced the following percentage returns. The table also presents the returns of the

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During the boom years of 2003-2007, ace mutual fund manager Diana Sauros, produced the following percentage returns. The table also presents the returns of the market and the free rate interest rate. 2003 2004 2005 2006 2007 2008 2009 Ms. Sauros 24.9 -0.9 18.6 40.1 15.2 -0.9 S&P 500 17.2 1 16.1 30.1 12.7 -0.15 -35.9 Free Interest rate% 1.01 1.5 3 4.5 Question: Calculate the average return that you could have earned over this period if you had held a combination of the market and a risk-free loan. Make sure that the combination has the same beta as Ms. Sauros's portfolio. 4.52% 12.16% 14.75% 3.64% 12.25% Question: Calculate the average return that you could have earned over this period if you had held a combination of the market and a risk-free loan. Make sure that the combination has the same beta as Ms. Sauros's portfolio. 4.52% 12.16% 14.75% 3,64% 12.25%

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