If your portfolio is invested 35 percent each in A and B and 30 percent in C what is the portfolio.

QUESTION

If your portfolio is invested 35 percent each in A and B and 30 percent in C, what is the portfolio expected return? (Round your answer to 2 decimal places, (e.g., 32.16)) Portfolio expected return % What is the variance? (Do not round intermediate calculations and round your final answer to 5 decimal places, (e.g., 32.16161)) Variance What is the standard deviation? (Do not round intermediate calculations and round your final answer to 2 decimal places, (e.g., 32.16)) Standard deviation % If the expected T bill rate is 3.10 percent, what is the expected risk premium on the portfolio? (Round your answer to 2 decimal places, (e.g., 32.16)) Expected risk premium % If the expected inflation rate is 2.70 percent, what are the approximate and exact expected real returns on the portfolio? (Round your answers to 2 decimal places, (e.g., 32.16)) Approximate expected real return % Exact expected real return % What are the approximate and exact expected real risk premiums on the portfolio? (Round your answers to 2 decimal places, (e.g., 32.16)) Approximate expected real risk premium % Exact expected real risk premium %
b) T bill rate = 3.10% = 0.0310 Risk premium = E (Rp) Rf = 0.0663 0.0310 = 0.0353 = 3.53 % c) 1. Exxpected real return = 0.0663 0.0270 = 0.0393 =

93 % 2. Expected real risk premium = Risk premium inflation rate = 0.0353 0.0270 = 0.0083 = 0.83 %

ANSWER:

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