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Problem:

Lindsay Brown owns a risky portfolio with a 15% expected return. The riskfree return is 5%.

Required:

Question: What is the expected return on Lindsay's total portfolio if Lindsay invests the following proportions in the risky portfolio and the remainder in the riskfree assets?

a. 120%

b. 90%

c. 75%

Note: Please show how you came up with the solution.

Basic Finance, Finance

  • Category:- Basic Finance
  • Reference No.:- M91162704

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