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Suppose the expected return on the tangent portfolio is 10% and its volatility is 40%. The risk-free rate is 2%. (a) What is the equation

Suppose the expected return on the tangent portfolio is 10% and its volatility is 40%. The risk-free rate is 2%. (a) What is the equation of the Capital Market Line (CML)? (b) What is the standard deviation of an efficient portfolio whose expected return is 8%? How would you allocate $1,000 to achieve this position?

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