NEED HELP WITH D & E, Already answered ABC

Refer to Table 6.3 and consider these three-year strategies: Three-In (fully invested in the risky portfolio in each of the three years); One-In (fully invested in the risky portfolio in one year, and in the risk-free asset in the other two); and Third-In-Three (one-third of the portfolio invested in the risky portfolio and the remainder in T-bills in each of the three years).

a. Create a table like Table 6.3 for these three strategies.

Strategy	Three-In	One-In	Third-In-Three
Risk premium	R + R + R = 3R	0 + 0 + R = R	3 1/3 R = R
Variance	2+2+2=322+2+2=32	0+0+2=20+0+2=2	2/3
Sharpe ratio	3R3=S133R3=S13	R/=S1R/=S1	R2/3=S13R2/3=S13
Price of risk	R/2=P1R/2=P1	R/2=P1R/2=P1	R2/3=3P1R2/3=3P1

b. Which strategy has the lowest Sharpe ratio?

	Three-In
	One-In
	Third-In-Three

c. Which strategy provides the highest price of risk?

	Three-In
	One-In
	Third-In-Three

d. Suppose your risk aversion coefficient is A = 3, the expected return on the risky portfolio is 20%, the standard deviation of the risky portfolio is 25%, and the T-bill rate is 5%. If you were allocating your complete portfolio in any year between Three-In and T-bills, what fraction would you devote to Three-In? (Round your answer to 2 decimal places.)

y_Three-In

e. If you were allocating your complete portfolio in any year between Third-In-Three and T-bills, what fraction would you devote to Third-In-Three? (Round your answer to 2 decimal places.)

y_{Third-In-Three}

TABLE 6.3 Two-year risk premium, variance, Sharpe ratio and price of risk for three strategies Two-In One-In2 Half-in-Two3 Strategy: Risk premium Variance Sharpe ratio4 Price of risk5 RR 2R 2 x 12 RR 28 = sN2 V2 -= 2P1 o2/2 Two-In: Invest entirely in the risky portfolio for two years. 2One-In: Invest entirely in the risky portfolio for one year and in the risk-free asset in the other. Half-in-Two: Invest half the budget in the risky portfolio for two years. Risk premium Standard deviation Risk premium ratio- Price of risk TABLE 6.3 Two-year risk premium, variance, Sharpe ratio and price of risk for three strategies Two-In One-In2 Half-in-Two3 Strategy: Risk premium Variance Sharpe ratio4 Price of risk5 RR 2R 2 x 12 RR 28 = sN2 V2 -= 2P1 o2/2 Two-In: Invest entirely in the risky portfolio for two years. 2One-In: Invest entirely in the risky portfolio for one year and in the risk-free asset in the other. Half-in-Two: Invest half the budget in the risky portfolio for two years. Risk premium Standard deviation Risk premium ratio- Price of risk