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Question 3 (3 Points): An investor has the opportunity to create a portfolio consisting of a risk-free asset with a return of rf=0.05 per year
Question 3 (3 Points): An investor has the opportunity to create a portfolio consisting of a risk-free asset with a return of rf=0.05 per year and a risky asset with an expected return of E[rA]=0.15 per year and an annual standard deviation of A=0.25. The investor wants a portfolio with a standard deviation of P=0.18. What would the expected return rP of the portfolio be
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