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Q4 (Essential to cover a, b) Consider investors with preferences represented by the utility function U = E(r) A02 a. Draw the indifference curve representing
Q4 (Essential to cover a, b) Consider investors with preferences represented by the utility function U = E(r) A02 a. Draw the indifference curve representing a utility level of 10% for an investor with a risk aversion parameter A = 3 in expected return-standard deviation space. b. In the same graph, draw the indifference curve representing a utility level of 15% for an investor with a risk aversion parameter A = 3. c. In the same graph, draw the indifference curve representing a utility level of 10% for an investor with a risk aversion parameter A = 5. Q4 (Essential to cover a, b) Consider investors with preferences represented by the utility function U = E(r) A02 a. Draw the indifference curve representing a utility level of 10% for an investor with a risk aversion parameter A = 3 in expected return-standard deviation space. b. In the same graph, draw the indifference curve representing a utility level of 15% for an investor with a risk aversion parameter A = 3. c. In the same graph, draw the indifference curve representing a utility level of 10% for an investor with a risk aversion parameter A = 5
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