Security Market Line. Need Help, Urgent. Please include all parts.

(Security market line) James Fromholiz is considering whother to irvest in a nowly formed invesiment fund. The funds investiment objective is to asquire home mongage socunties at whot at hopes wit be bargain prices. The fund sponsor has tuggested to James that the funds performance wit tinge co how the national economy performs in the corming year. Specifealy, he suggetied security macket ine concopt to his antilysis. b. James is aleo considering the invectiment of tis money in a mankatindex fund that has an expectod rate of return of 8 porcent, What is the alope of the securicy macket ine (i. A, the reward to fiet ruto) for this invetiment opportunity? c. Based on your analysis of parts a and b above. Which investrient should Jamos take? Why? (Round to two decimal places.) tor this investment opporturity is 6. (Round to two decima places) c. Based on yout analyis of pasts a and b abore, which hivestineet should Jamos take? Why? (3elect the best choice beiow.) A. The real estale portfolio B. Cannot be delemined trom the infeemation given in tha problem. c. The market index fund: (Security markot tine) James Fromholuz is contidoring whether to invest in a nowy formed investment fund. The funds investnent objective is to acquire home mortgege secuities at what it hopes wit be bargain prices. The fund sponsor has suggested to James that the fund's performance will hinge on how the nasonal econorcy pertorms in the coming year. Speofically, he suggessed the following posseble outcomes: James has estmated the expected rate of return from this irvestmont is 23.00 porcont James wants to apply his rocontly acquirod understanding of the securtity manket line concopt to his analysis. a. If the risk-free rate of interest is currenty 2.2 percent and the beta for the investment is 3.5, what is the slope of the securty maiket line for the roal estate morignge security investment? b. James is also considening the investiment of his monoy in a manket index tund that has an expected rate of return of 8 percent. What is the slope of the secunily markat ine (Le. the rawarditorisk. ratio) for this investment opportunity? c. Baced on your analyais of parta a and b abovo, which itvesiment should James take? Why? 2. If the risk tioe rate of intorest is currently 2.2 percent and the bota for the investment is 3.5, the slopo of the securify manket line for the real estate morigage secunty investiment is (Round to two decimal places.) b. James is also considering the investment of his money in a maket index fund that has an espected rate of return of 8 percent. The slope of the securay market line (i.e., the rewardto-risk rato) for this irvestment opportunity is (Round to two decimal places.) c. Based ce your analysis of parts a and b above. Which investenent ahould sames take? Why? (5elect the best choico below) A. The real estate portfolio B. Cannot be detarmined from the informatio Data table c. Thie market index fund