Please help with Question c ONLY

You are the CEO of the Investor & Co. You have budget of 10.000.000 to manage and invest. You want to decide whether to invest in the risk-free asset (RF), Bond (B), or Equity (E). You know your decision must build upon the Capital Asset Pricing Model (CAPM) al You decide to try to invest in the Risk Free and Equity only. Graph and describe the efficient frontier for Equity (E) and the risk-free asset (RE). In this graph, show the location of the optimal risky portfolio. Discuss how you find the location, and in what sense this portfolio (or these portfolios) is (are)optimal. Show also where person willing to borrow will be located (30 marks) b. You decide to try^to invest in Bonds and Eguity only. Graph and describe the efficient frontier for two risky assets, E (Equity) and B (Bonds) in the case that pAB where pAB is the correlation coefficient between E and B. Is diversification effective in reducingrisk, even there is no correlation among the two assets? Discuss in what sense mixing the two assets in 9ne portfolio reduces risk even in this case. (30 marks) c. "The CAPM diversification reduces the portfolio risk by driving its unique component to zero" Discuss the sentence above, and what it implies for the exercise. How many assets you should buy? (40 Marks) You are the CEO of the Investor & Co. You have budget of 10.000.000 to manage and invest. You want to decide whether to invest in the risk-free asset (RF), Bond (B), or Equity (E). You know your decision must build upon the Capital Asset Pricing Model (CAPM) al You decide to try to invest in the Risk Free and Equity only. Graph and describe the efficient frontier for Equity (E) and the risk-free asset (RE). In this graph, show the location of the optimal risky portfolio. Discuss how you find the location, and in what sense this portfolio (or these portfolios) is (are)optimal. Show also where person willing to borrow will be located (30 marks) b. You decide to try^to invest in Bonds and Eguity only. Graph and describe the efficient frontier for two risky assets, E (Equity) and B (Bonds) in the case that pAB where pAB is the correlation coefficient between E and B. Is diversification effective in reducingrisk, even there is no correlation among the two assets? Discuss in what sense mixing the two assets in 9ne portfolio reduces risk even in this case. (30 marks) c. "The CAPM diversification reduces the portfolio risk by driving its unique component to zero" Discuss the sentence above, and what it implies for the exercise. How many assets you should buy? (40 Marks)