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Please assist with this questions Assume that you manage a risky portfolio with an expected rate of return of 20% and a standard deviation of

Please assist with this questions

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Assume that you manage a risky portfolio with an expected rate of return of 20% and a standard deviation of 46%. The T-bill rate is 5%6. Your risky portfolio Includes the following Investments in the given proportions 304 Your client decides to Invest in your risky portfolio a proportion (4 of his total investment budget with the remainder in a T-bill money market fund so that his overall portfolio will have an expected rate of return of 14% a. What is the proportion of (Round your answer to 1 decimal places.) ) Answer Is complete but not entirely correct. Proportion y b. What are your client's Investment proportions in your three stocks and in T-bils? [Round your Intermediate calculations and Meal wowwer to 2 decimal places.) Answer is complete and correct. Invisiman Proportions & Prow To10 Next 3 MacBook Air 3 LU > C O LL 1 ISuppose your expectations regarding the stock market are as follows: State of the Economy Probability HPR Boom 0.4 384 Normal growth 0.3 Recession 0.3 -19 E(r) = > p(s) r(s) Var(7) = d' = > p(s)[r(s) - E()] SD(r) = 0 = VVar(r) Use above equations to compute the mean and standard deviation of the HPR on stocks. ( Round your answers to 2 decimal places.) Mean Standard deviation Prev 1 of 10 Next MacBook AirConsider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $50,000 or $155,000, with equal probabilities of 0.5. The alternative riskless investment in T-bills pays 6% a. If you require a risk premium of 7%, how much will you be willing to pay for the portfolio? (Round your answer to the nearest amount.) Value all the Portfolio b. Suppose the portfolio can be purchased for the amount you found in [of What will the expected rate of return on the portfolio be (Do not round intermediate calculations. Round your answer to the nearest whole percent) nearest dollar amount) c. Now Suppose you require a risk premium of Ink. What Is the price you will be willing to pay now? (Round your answer to the Volun of the portlalo MacBook Air 44 CO 3 LU > O O

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