The aim of this question is to make you better understand the characteristics of the CAL. Stick to the market described in the previous question after we added the risk-free asset with return rf = 0.03 1. Verify that the CAL is indeed generated by all possible portfolio (CAL)T = [OCAL, CALIT only containing the risky free asset (asset 0) and the tangency portfolio t in the different proportion CA and OCAL respectively hint 1: derive the CAL equation CAL (CAL) and show that coincides with (0) = Try + Ho, where H is the Sharpe ratio of portfolio hint 2: remember that the risk-free asset has zero risk 2. Stick to the market described in the Question 3 after we added the risk-free asset with return rf = 0.03 compute and 1 draw the CAL using the CAL equation CAL (CAL) locate the minimum variance portfolio, what are the weights in terms of CAL? locate the tangency portfolio t", what are the weights in terms of CAL? what happens to the weights CAL for (i) CAL < 0, (ii) po = j < CAL < . and (iii) CAL> - -hint 1: if CAL )0 we borrow(lend) at the risk-free rate while CAL < (>)0 we short (own) the tangency portfolio hint 2: risk cannot be negative...