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Your client has $104,000 invested in stock A. She would like to build a two-stock portfolio by investing another $104,000 in other stock B or

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Your client has $104,000 invested in stock A. She would like to build a two-stock portfolio by investing another $104,000 in other stock B or C. She wants a portfolio with an expected return of at least 15.0% and as low a risk as possible, but the standard deviation must be no more than 40%. What do you advise her to do, and what will be the portfolio expected return and standard deviation? Expected Return Standard Deviation Correlation with A 16% 48% 1.00 B 14% 35% 0.13 14% 35% 0.32 The expected return of the portfolio with stock Bis 1% (Round to one decimal place.)

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