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Suppose that you have $1 million and the following two opportunities from which to construct a portfolio: Risk-free asset earning 7% per year. Risky asset
Suppose that you have $1 million and the following two opportunities from which to construct a portfolio:
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Risk-free asset earning 7% per year.
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Risky asset with expected return of 22% per year and standard deviation of 30%.
If you construct a portfolio with a standard deviation of 24%, what is its expected rate of return? (Do not round your intermediate calculations. Round your answer to 1 decimal place.)
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