Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please solve in 50 mins i need all subparts please help. i will give thumbs up Question 4 (20 points) The following table presents data

image text in transcribed

image text in transcribed

please solve in 50 mins i need all subparts please help. i will give thumbs up

Question 4 (20 points) The following table presents data of two portfolios, traded in the market: Portfolio A Portfolio B Market portfolio Expected return Standard deviation Beta 14.5% 50% 1.25 7% 30% 0.5 ? 40% ? a. Calculate the expected return of the market portfolio and the risk-free rate. Answer: The expected return of the market portfolio is %_ The rf rate is % b. Which one of the two portfolios is efficient? Answer: The efficient portfolio is rf asset ? ? ? An investor has $100,000 to invest and wants to receive an expected return of 10%. c. How can she earn the target expected return? Answer: She will invest $ invest $ invest $ in portfolio A. in portfolio B. in risk free asset. d. Following c, what is the standard deviation of the portfolio? Answer: The standard deviation portfolio is %_ e. What is the total investment in the market portfolio? Answer: The total investment in the market portfolio is $_

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Literacy And Money Script A Caribbean Perspective

Authors: Christine Sahadeo

1st Edition

3319770748, 978-3319770741

More Books

Students also viewed these Finance questions