Question

Asked Oct 1, 2019

Step 1

**a.**

Given,

Standard Deviation of Portfolio = 46%

New Standard Deviation of Portfolio = 35%

Calculation of Investment Proportion y:

Step 2

**b.**

Investment Proportion = 76.09%

Expected Rate of Return = 20%

T-Bill Proportion = 23.91%

T-Bill Rate = 5%

Calculation of Expected Rate of Return of Client’s Portfolio:

Step 3

**Working Note:**

Calculation of T-Bill Proport...

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