Question
Fund A sells at $32 a share and has a 3-year average annual return of $3 per share. The risk measure of standard deviation is
Fund A sells at $32 a share and has a 3-year average annual return of $3 per share. The risk measure of standard deviation is 15.5. Fund B sells at $44 a share and has a 3-year average annual return of $8 a share. The risk measure of standard deviation is 13.3. Sally Burkhardt wants to spend no more than $6000 investing in these two funds, but she wants to obtain at least $700 in annual revenue. Sally also wants to minimize her risk. Determine how many shares of stock Sally should buy. Sally should buy ( ) shares of Fund A and ( ) shares of Fund B.
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