SECTION IT these questions are worth double in weight -41. (Double weight question) Suppose in security. The securities returns are: r on) Suppose investors form portfolios by combing one risky security with one risk free security. The Risk free -0.03 risky -0.15 and SD -0.25 Let wl denote the share of wealth in the risky asset utility function. wealth in the risky asset. Determine the optimal portfolio for an investor with the following (This is of the form E(u)-(expected return on the portfolio)- 1/2A ) Eu) - rp-502 Let wl be the risky asset. Answers are rounded 111111111111111IIIIIIIIII a) wlis 34% and the risk free 66% b) wlis 19% and the risk free 81% c) wlis 24% and the risk free 76% d) wlis 37% and the risk free 63% Scenario question (Double weight question) - USE This information for 42, 43, 44, A passive ETF that tracks the S&P/TSX yields an expected return of 14% with standard (SD) of 24%. You manage a portfolio with an expected rate of return of 18% and a standard deviation of 28%. Assume the risk free rate is 8% (we wish!). Suppose that the client wants to put 70% of his money in the ETF and 30% in the risk free. *42. If the client uses the passive ETF strategy his expected rate of return is: a) the same as your portfolio. b) greater than your portfolio. c) less than your portfolio