Question: PROBLEM 4 (15 MARKS) Assume that there are only two stocks in an economy and no T-bills: Security Expected Return Standard deviation of return X

PROBLEM 4 (15 MARKS) Assume that there are only two stocks in an economy and no T-bills: Security Expected Return Standard deviation of return X .05 .15 Y .12 .20 10 The correlation coefficient between the returns of the two stocks is = -1. a. (3 MARKS) Sketch the graph of the portfolio opportunity set for an investor

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