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The expected rates of return for stocks A and B are 28% and 22% respectively. The T-bill rate is 12% and the expected rate of

  1. The expected rates of return for stocks A and B are 28% and 22% respectively. The T-bill rate is 12% and the expected rate of return on S&P 500 index is 24%. The standard deviation of stock A is 22% while that of B is 20%. If you could invest only in T-bills plus one of these stocks, which stock would you choose?

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