Please see the attached file for full problem description.

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Suppose that there is one safe and one risky asset and that the investor has initial wealth . Investing in the risky asset yields the total (principal plus interest) of x(1+r), where r is a random variable with density f(r), r where < 0 < . The safe asset pays zero interest. The investor's final random wealth is Assume that , i.e., that short sales and borrowing at the riskless rate of interest to invest in the risky asset are not allowed. The risk averse von Neumann-Morgenstern investor chooses x to maximize . Prove that if the investor's measure of absolute risk aversion is a decreasing function of w, the wealthier investor will hold more of the risky asset.

You invest $1000 in a risky asset with an expected rate of return of 0.17 and a standard deviation of 0.40 and a T-bill with a rate of return of 0.04
A) What percentages of your money must be invested in the risky asset and the risk-free asset, respectively, to form a portfolio with an expected return of 0.11?
B) What per

In this problem, I have the expected return of the market, its volatility and the risk-free rate of return for both borrowing and lending. There exists also two riskyassets in the market (A and B) and I have the characteristic line regression which shows the relation between the returns for these two assets and the market portf

Using two riskyassets, one offers a higher return than the other, but it also has a higher standard deviation. Will one of these assets always lie on the efficient frontier? Will one of them always be inefficient if held alone?

Given the following expected return vector and variance-covariance matrix for three assets:
ER= 10.1
7.8
5.0
VC= 210 60 0
60 90 0
0 0 0
and given the fact that Pie Traynor's risky portfolio is split 50-50 between the two risky asets:
a) Which security of the thre

Would you please tell me which statements are incorrect? Why?
a When a loan is amortized, the interest portion and principal portion of the payment decreases and increases, respectively, each period during the life of the loan.
b It is impossible to construct a portfolio of riskyassets whose return is equal to the risk-fre

Calculate the expected return on the portfolio [E ( R )] of the following assets if you invest 20% in asset 1, 30% in asset 2, and 50% in asset 3. How and why will your answer change if you shift 20% of invested funds from the least risky (asset 3) to the most risky (asset 1) asset?
Asset Return
1.

Dr. Filly invests $100 in a risky asset and a risk-free asset. The risky asset has an expected return of 12% and a standard deviation of 15%, while the risk-free has a return of 5%.
What percentages of Dr. Fillyâ??s money must be invested in the risk-free asset and the risky asset, respectively, to form a portfolio with a sta

Suppose there are 2 riskyassets. One offers a higher return than the other, but it also has a higher standard deviation. Will one of these assets always lie on the efficient frontier? Will one of them always be inefficient if held alone?

Which one is right and why? (explain in one sentence)
A portfolio is:
a). a group of assets, such as stocks and bonds, held as a collective unit by an investor.
b). the expected return on a risky asset.
c). the expected return on a collection of riskyassets.
d). the variance of returns for