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Business, 11.04.2020 01:36 Jessieeeeey

You are considering investing $1,400 in a complete portfolio. The complete portfolio is composed of Treasury bills that pay 4% and a risky portfolio, P, constructed with two risky securities, X and Y. The optimal weights of X and Y in P are 60% and 40% respectively. X has an expected rate of return of 18%, and Y has an expected rate of return of 14%. To form a complete portfolio with an expected rate of return of 9%, you should invest approximately in the risky portfolio. This will mean you will also invest approximately and of your complete portfolio in security X and Y, respectively. Show all calculation

a. 0%; 60%; 40%

b.50%; 30%; 20%

c.40%; 24%; 16%

d. 32%; 42%; 26%

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