Question: #1. A 1 percentage point increase in expected return and 1 percentage point decrease in the risk-free rate will have the same impact of increasing

#1. A 1 percentage point increase in expected return and 1 percentage point decrease in the risk-free rate will have the same impact of increasing sharpe ratio from 0.40 to 0.45.

think of the CALine and what the sharpe ratio represents.

a) A 1 precentage point increase in expected return b) A 1 percentage point decrease in ........ c) A 1 percentage point increase in the risk-free rate. d) A 1 percentage point decrease in its standard deviation

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