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Linda plans to invest in a portfolio which comprises an equity (risky) fund and a T-bill money market fund. The equity fund invested 60% in

Linda plans to invest in a portfolio which comprises an equity (risky) fund and a T-bill money market fund. The equity fund invested 60% in stock A and 40% in stock B. The expected return of stock A is 26%. The expected return of stock B is 12%. The variance of the equity fund is 8.41%. T-bill rate is 3%. If Linda decides to invest 120% of her money in the equity fund, what is the expected return of Lindas complete portfolio?

A.

24.5%

B.

19.6%

C.

23.9%

D.

22.2%

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