Suppose that many stocks are traded in the market and that it is possible to borrow at the risk-free rate, r. The characteristics of two of the stocks are as follows: Stock Expected Return Standard Deviation A 8 % 55 % B 4 % 45 % Correlation = 1 a. Calculate the expected rate of return on this risk-free portfolio? (Hint: Can a particular stock portfolio be substituted for the risk-free asset?) (Round your answer to 2 decimal places.) b. Could the equilibrium r be greater than 5.80%? multiple choice Yes No