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portfolo is comprised of Treasury bils and stock in Ford (F) and Halley Davidson (HOG) a. Based co the current portlolio composition and the expected

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portfolo is comprised of Treasury bils and stock in Ford (F) and Halley Davidson (HOG) a. Based co the current portlolio composition and the expected rates of return, what is the expected rale of retum for Penmy's portblio? b. II Penny wants to increase her expected portobo rate of return, she can increase the allocated weight of the porttolio she has invested in stock (Ford and Haley Davisich) and decrease her holdings of Treasury bils. If Peney moves all her money out of Treasury bils and splits & evenly between the fwo stocls, what will be her expected rale of refurn? c. If Perny does move money out of Treasury bills and into the two stocks, she wit reap a higher expected porttolo retum, so why would anyone want to bold Treasury Bifls in their portflo? \begin{tabular}{lcc} & Expected & $ Value \\ Treasury bills & Return & 85,000 \\ Ford (F) & 4.9% & 59,000 \\ Harley Davidson (HOG) & 8.9% & 56,000 \\ \hline lick on the icon D in order to copy its contents into a spreadsheet) \end{tabular}

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