1. You are creating a portfolio of a stock and the risk free asset. The stock has a return of 14% and a standard deviation of 28%. The risk free rate is 5%.

What is the Sharpe ratio of the risky portfolio?

If you put 50% in the stock and 50% in the risk free asset, what is the Sharpe ratio of the complete portfolio?

2. You are creating a portfolio of a stock and a risk free asset. The stock has a return of 8% and a standard deviation of 14%. The risk free rate is 3%. How much of your portfolio should you put in the risky asset for the portfolio return to be 6.5%? What would the risk of this complete portfolio be?
3. Draw a CAL for complete portfolios made of a risky asset with an expected return of 10% and a standard deviation of 20% and a risk-free asset with a return of 2%. Make sure to label the y-intercept and your axes. Also, add a point to your CAL indicating where an investor with a risk aversion (A) of 5 would invest.