Your client, Bo Regard, holds a complete portfolio that consists of a portfolio of risky assets $(P)$ and T$-$

Bills. The information below refers to these assets.

$($a$)$ Calculate the expected return on Bo's complete portfolio. $(10$ pts$.)$

$($b$)$ Calculate the standard deviation of Bo's complete portfolio? $(10$ pts$.)$

$($c$)$ Write down the equation of Bo's capital allocation line and draw the line on a graph. $(10$ pts$.)$

$($d$)$ Assume that Bo has the quadratic utility function of the form $U(R_c)=E(R_c)-\frac{1}{2}{A}_i{}_c^2,$ and allocates his

complete portfolio optimally so as to maximize utility. Bo has a risk aversion coefficient of $A=0\mathrm{.}5.$

His portfolio manager argues that Bo did not allocate his complete portfolio optimally. Is the portfolio

manager right or wrong? Prove quantitatively and argue qualitatively. $(20$ pts$.)$