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On the advice of her wealth manager, Ms. Roth invested in a portfolio of stocks. The standard deviation of her portfolio is 50% and its
On the advice of her wealth manager, Ms. Roth invested in a portfolio of stocks. The standard deviation of her portfolio is 50% and its beta is 1.5 . The expected return on the market portfolio is 15% and the standard deviation of returns on the market portfolio is 18%. The risk-free rate is 5.4%. Ms. Roth does not want to increase the total risk of her portfolio, but suspects that she can earn more return by rebalancing her portfolio. What return can Ms. Roth earn if her portfolio becomes efficient? 33.26%32.07%29.01%30.15% Ms. Roth's portfolio cannot earn higher returns because it is already efficient and earns appropriate return
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