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Question is allocation pb P=q for m P=1-q for M and - n are excess returns y goes to risky asset and 1-y to the
Question is allocation pb
P=q for m P=1-q
for M and - n are excess returns
y goes to risky asset and 1-y to the rest
a) optimal allocation for the portfolio
b) show that if q and or m get larger then y increases
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