Question: Asset Class E ( R ) CS FI PR S 8.7 % 14.2 % 1.0 FI 5.6 7.9 0.3 1.0 PR 7.1 11.5 0.5 0.2

Asset Class E(R) CS FI PR
S 8.7 % 14.2 % 1.0
FI 5.6 7.9 0.3 1.0
PR 7.1 11.5 0.5 0.2 1.0
RFR 3.1

You have already determined that the expected return and standard deviation for the Current Allocation are: E(Rcurrent) = 7.46 percent and current = 9.936 percent.

  1. Calculate the expected return for the Proposed Allocation. Round your answer to two decimal places.

    %

  2. Calculate the standard deviation for the Proposed Allocation. Do not round intermediate calculations. Round your answer to two decimal places.

    %

  3. For both the Current and Proposed Allocations, calculate the expected risk premium per unit of risk (that is, [E(Rp) - RFR]/). Do not round intermediate calculations. Round your answers to three decimal places.

    Current Allocation:

    Proposed Allocation:

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