Question: Exhibit 7.3 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Asset (A) Asset (B) E(RA) = 9% E(RB) = 11% (CA) = 4% (OB) =

Exhibit 7.3 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Asset

Exhibit 7.3 USE THE INFORMATION BELOW FOR THE FOLLOWING PROBLEM(S) Asset (A) Asset (B) E(RA) = 9% E(RB) = 11% (CA) = 4% (OB) = 6% WA = 0.4 We = 0.6 COVA.B = 0.0011 8. Refer to Exhibit 7.3. What is the expected return of a portfolio of two risky assets if the expected return E(Ri), standard deviation (0), covariance (COVij), and asset weight (W;) are as shown above? a. 8.95% b. 9.30% c. 9.95% d. 10.20% e. 10.70% 9. Refer to Exhibit 7.3. What is the standard deviation of this portfolio? a. 3.68% b. 4.56% C. 4.99% d. 5.16% e. 6.02%

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