Question: You are considering two mutual funds. The first is a stock fund with an expected return of 20% and a variance of 0.36. The second

You are considering two mutual funds. The first is a stock fund with an expected return of 20% and a variance of 0.36. The second is a T-bill money market fund that generates a sure rate of 1%. If you want to create a portfolio that yield an expected return of 22%, what should you do with the money market fund?

A.

Buy $110,530 of the money market fund

B.

Borrow $110,530 of the money market fund

C.

Buy $10,530 of the money market fund

D.

Borrow $10,530 of the money market fund

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