The expected returns and variances-covariances matrix for four assets are given in the following table: Asset Variance-covariance matrix V 1 2 3 4 0.5 0.15 0.10 -0.37 0.15 0.25 0.45 0.54 0.10 0.45 0.40 -0.21 -0.37 0.54 -0.21 0.30 Expected Return (r) 0.10 0.06 0.12 0.07 If the risk-free rate is 5% and the average desired return is 10%: a) What is the optimal portfolio? In other words, we want to know how much to invest in Asset 1 (weight of Asset 1)? How much to invest in Asset 2 (weight of Asset 2)? How much to invest in Asset 3 (weight of Asset 3)? How much to invest in Asset 4 (weight of Asset 4)? b) And how much to invest in the risk-free asset (weight of risk-free Asset)? c) What is your interpretation of both (risky and risk-free) assets weights? d) What is the variance of return for this portfolio? The expected returns and variances-covariances matrix for four assets are given in the following table: Asset Variance-covariance matrix V 1 2 3 4 0.5 0.15 0.10 -0.37 0.15 0.25 0.45 0.54 0.10 0.45 0.40 -0.21 -0.37 0.54 -0.21 0.30 Expected Return (r) 0.10 0.06 0.12 0.07 If the risk-free rate is 5% and the average desired return is 10%: a) What is the optimal portfolio? In other words, we want to know how much to invest in Asset 1 (weight of Asset 1)? How much to invest in Asset 2 (weight of Asset 2)? How much to invest in Asset 3 (weight of Asset 3)? How much to invest in Asset 4 (weight of Asset 4)? b) And how much to invest in the risk-free asset (weight of risk-free Asset)? c) What is your interpretation of both (risky and risk-free) assets weights? d) What is the variance of return for this portfolio