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Suppose that the SP 500 index has an expected return of 7% and a standard deviation of returns of 15%. The risk-free rate is 5%.
Suppose that the SP 500 index has an expected return of 7% and a standard deviation of returns of 15%. The risk-free rate is 5%. The portfolio on the Capital Allocation Line (CAL) that has an expected return of 20% invests weight 65% in the SP 500. Answer if true or false, and show all your calculations.
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