As a fund manager, you are faced with four investment alternatives as follows: Expected Return 1...

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As a fund manager, you are faced with four investment alternatives as follows: Expected Return 1 2 3 4 Investasi 0,12 0,18 0,21 0,25 Standar Deviation 0,30 0,40 0,18 0,20 a. Based on the above information, the estimated utility value of each investment alternative. With a degree of risk averse (A) of 4, which investment would you choose? Answer: b. If you are risk neutral, which investment will you choose? What is the rationale? As a fund manager, you are faced with four investment alternatives as follows: Expected Return 1 2 3 4 Investasi 0,12 0,18 0,21 0,25 Standar Deviation 0,30 0,40 0,18 0,20 a. Based on the above information, the estimated utility value of each investment alternative. With a degree of risk averse (A) of 4, which investment would you choose? Answer: b. If you are risk neutral, which investment will you choose? What is the rationale?

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To calculate the estimated utility value U for each investment alternative you can use the following ... View the full answer