You are creating a complete portfolio for an investor with a risk aversion (A) equal to 5.

The expected return and risk of the optimal risky portfolio are 10% and 15%, respectively.

Assume a risk-free rate of 0.2%.

(a) What are the expected return, risk, and Sharpe ratio of the complete portfolio?

(b) If the investors risk aversion was equal to 10 instead of 5, how would that change

the expected return, risk, and Sharpe of the complete portfolio? Explain your

answer.