Question: A respected analyst forecasts that the return of the S&P 500 Index portfolio over the coming year will be 10%. The one-year T-bill rate is

A respected analyst forecasts that the return of the S&P 500 Index portfolio over the coming year will be 10%. The one-year T-bill rate is 3%. Examination of recent returns of the S&P 500 Index suggests that the standard deviation of returns will be 18%. What is the Sharpe measure of the portfolio?

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