Question

An investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 0.15 and a variance of 0.04 and 70 percent in a T-bill that pays 6 percent. His portfolio's expected return and standard deviation are and , respectively. A. 0.114; 0.12 B. 0.087; 0.06 C. 0.295; 0.12 D. 0.087; 0.12 E. none of the above

Name: an investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 015 and a variance of 004 and 70 percent in a t bill that pays 6 percent his portfolios expec 58724
Uploaded: 2022-04-15T15:52:09-08:00
Duration: 2 min 8 s
Channel: Rachel Gore
Description: an investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 015 and a variance of 004 and 70 percent in a t bill that pays 6 percent his portfolios expec 58724

          An investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 0.15 and a variance of 0.04 and 70 percent in a T-bill that pays 6 percent. His portfolio's expected return and standard deviation are __________ and __________, respectively.
A. 0.114; 0.12
B. 0.087; 0.06
C. 0.295; 0.12
D. 0.087; 0.12
E. none of the above

Added by Brenda A.

Principles of Economics

Gregory Mankiw 8th Edition

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Solved by Expert Rachel Gore

04/15/2022

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The investor invests 30% of his wealth in a risky asset with an expected rate of return of 0.15. Expected return of the risky asset = 0.30 * 0.15 = 0.045 Show more…

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An investor invests 30 percent of his wealth in a risky asset with an expected rate of return of 0.15 and a variance of 0.04 and 70 percent in a T-bill that pays 6 percent. His portfolio's expected return and standard deviation are __________ and __________, respectively. A. 0.114; 0.12 B. 0.087; 0.06 C. 0.295; 0.12 D. 0.087; 0.12 E. none of the above