The stock of Business Adventures sells for $50 a share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows: Required: a. Calculate the expected holding-period return and standard deviation of the holding-period return. All three scenarios are equally likely. (Do not round intermediate calculations. Round your answers to 2 decimal places.) b. Calculate the expected return and standard deviation of a portfolio invested half in Business Adventures and half in Treasury bills. The return on bills is 5%. (Do not round intermediate calculations. Round your answers to 2 decimal places.) Consider a risky portfolio. The end-of-year cash flow derived from the portfolio will be either $60,000 or $160,000, with equal probabilities of 0.5. The alternative riskless investment in T-bills pays 5%. Required: a. If you require a risk premium of 8%, how much will you be willing to pay for the portfolio? (Round your answer to the nearest dolla amount.) b. Suppose the portfolio can be purchased for the amount you found in (a). What will the expected rate of return on the portfolio be? (Do not round intermediate calculations. Round your answer to the nearest whole percent.) c. Now suppose you require a risk premium of 12%. What is the price you will be willing to pay now? (Round your answer to the nearest dollar amount.) Assume that you manage a risky portfolio with an expected rate of return of 17% and a standard deviation of 41%. The T-bill rate is 5%. Your client chooses to invest 75% of a portfolio in your fund and 25% in a T-bill money market fund. Required: a. What are the expected return and standard deviation of your client's portfolio? (Round your answers to 1 decimal place.) b. Suppose your risky portfolio includes the following investments in the given proportions: What are the investment proportions of your client's overall portfolio, including the position in T-bills? (Round your answers to 1 decimal place.) b. Suppose your risky portfolio includes the following investments in the given proportions: What are the investment proportions of your client's overall portfolio, including the position in T-bills? (Round your answers to 1 decimal place.) c. What is the reward-to-volatility ratio (S) of your risky portfolio and your client's overall portfolio? (Round your answers to 4 decimal places.) Assume that you manage a risky portfolio with an expected rate of return of 14% and a standard deviation of 30%. The T-bill rate is 6%. Your risky portfolio includes the following investments in the given proportions: Your client decides to invest in your risky portfolio a proportion (y) of his total investment budget with the remainder in a T-bill money market fund so that his overall portfolio will have an expected rate of return of 13%. Required: a. What is the proportion y ? (Round your answer to 1 decimal place.) b. What are your client's investment proportions in your three stocks and in T-bills? (Round your intermediate calculations and final answers to 2 decimal places.) b. What are your client's investment proportions in your three stocks and in T-bills? (Round your intermediate calculations and final answers to 2 decimal places.) c. What is the standard deviation of the rate of return on your client's portfolio? (Round your intermediate calculations and final answer to 1 decimal place.) Assume that you manage a risky portfolio with an expected rate of return of 15% and a standard deviation of 31%. The T-bill rate is 5% A client prefers to invest in your portfolio a proportion (y) that maximizes the expected return on the overall portfolio subject to the constraint that the overall portfolio's standard deviation will not exceed 20%. Required: a. What is the investment proportion, y ? (Do not round intermediate calculations. Round your answer to 2 decimal places.) b. What is the expected rate of return on the overall portfolio? (Do not round intermediate calculations. Round your answer to 2 decimal places.) Required: You manage an equity fund with an expected risk premium of 13% and a standard deviation of 44%. The rate on Treasury bills is 6.6%. Your client chooses to invest $90,000 of her portfolio in your equity fund and $60,000 in a T-bill money market fund. What are the expected return and standard deviation of your client's portfolio? (Round your answers to 2 decimal places.)