Question $7$

$1pts$

There are two risky assets, debt and equity. The expected return is $8\%$ on the debt and $13\%$ on the equity. The standard deviation is $12\%$ for the debt and $20\%$ for the equity. The correlation coefficient between the debt return and the equity return is $30\%.$ The risk$-$free rate is $4\%.$ What are the weights of the debt and equity in the optimal portfolio?

$48\mathrm{.}7\%$

$50\mathrm{.}8\%$

$40\mathrm{.}4\%$

$30\mathrm{.}6\%$