This question is about financial economics. Please answer all parts of the question

Olivia is an investor who has only two primary assets, asset A and asset B, in which to hold her wealth, which is normalised to be 1. Asset A has mean 711,; = 4 and standard deviation 0,; = 2, while asset B has mean m3 = 2 and standard deviation 03 = 1. Olivia can choose as her portfolio any mixture between the two assets dened by A, where A is the fraction of her wealth that is held in asset A (so a fraction 1 A is held in asset B). Portfolios are restricted to satisfy 0 5 /\\ g 1. Olivia has constant absolute risk aversion preferences, with absolute risk aversion parameter equal to R, and her expected utility of a portfolio with mean m and standard deviation 0 is given by v(m, a) = m 953R. Olivia makes her portfolio decisions maximising this function. 1. Plot the two assets in the MSD graph. 2. Assume, for this question only that the correlation between the two assets is pAB = . (a) Find the equation for the efficient portfolio curve. (b) Find Olivia's optimal investment strategy )3, and the coordinates of her Optimal portfolio, (1113,09. (c) If R = %, what is Olivia's optimal portfolio