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    invest in a portfolio that has an expected return of 8%

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    4. You can invest in a portfolio that has an expected return of 8% and a standard deviation of 0.10. You can also borrow and lend any amount at the risk free rate of 3%.
    a. Create a portfolio that will have a standard deviation of 0.15 and compute this portfolio's expected return.
    b. If the portfolio is the market portfolio, write the Capital Market Line.

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    Solution Preview

    See the attached file. Hope this will help. Thanks

    4. You can invest in a portfolio that has an expected return of 8% and a standard deviation of 0.10. You can also borrow and lend any amount at the risk free rate of 3%.
    a. Create a portfolio that will have a standard ...

    Solution Summary

    The expert invests a portfolio that has an expected return of 8%. The market portfolio is written for capital market line.

    $2.19

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