Suppose that you currently have $$250,000$ invested in a portfolio with an expected return of $12\%$ and a volatility of $10\%.$ The efficient $($tangency$)$ portfolio has an expected return of $17\%$ and a volatility of $12\%.$ The risk$-$free rate of interest is $5\%.$ You want to maximize your expected return without increasing your risk. Without increasing your volatility beyond its current $10\%,$ the maximum expected return you could earn is closest to:

Question $5$ Answer

a$.$

$13\mathrm{.}4\%.$

b$.$

$12\mathrm{.}5\%.$

c$.$

$12\mathrm{.}0\%.$

d$.$

$15\mathrm{.}0\%.$