1. Question 33

   1 Point

   Use the following information for the next 4 questions.

   You invest $100 in the market portfolio with an expected return of 12% and a standard deviation of 20%, and a T-bill that pays 4%.

   If you desire to form a portfolio with an expected return of 8.8%, what percentages of your money must you invest in the market portfolio?

   1. 30%

   2. 40%

   3. 50%

   4. 55%

   5. 60%

2. Question 34

   1 Point

   Continuation of the previous problem:

   You invest $100 in the market portfolio with an expected return of 12% and a standard deviation of 20%, and a T-bill that pays 4%.

   If you desire to form a portfolio with a standard deviation of 10%, what percentages of your money must you invest in the market portfolio?

   1. 30%

   2. 40%

   3. 50%

   4. 60%

   5. 70%

3. Question 35

   1 Point

   Continuation of the previous problems:

   You invest $100 in the market portfolio with an expected return of 12% and a standard deviation of 20%, and a T-bill that pays 4%.

   A portfolio that has an expected outcome of $116 is formed by

   1. investing $100 in the risky asset.

   2. borrowing $30 at the risk-free rate and investing the total amount (=$130) in the risky asset.

   3. borrowing $50 at the risk-free rate and investing the total amount (=$150) in the risky asset.

   4. borrowing $75 at the risk-free rate and investing the total amount (=$175) in the risky asset.

4. Question 36

   1 Point

   Continuation of the previous problems:

   You invest $100 in the market portfolio with an expected return of 12% and a standard deviation of 20%, and a T-bill that pays 4%.

   The slope of the Capital Market Line formed with the market portfolio and the risk-free asset is equal to

   1. .263

   2. .320

   3. .376

   4. .40

   5. .523

5. Question