【正文】 a riskaverse investor and is a risky investment with a zero risk premium.E.20.The presence of risk means thatA.more than one oute is possible.C.final wealth will be greater than initial wealth.E.21.The utility score an investor assigns to a particular portfolio, other things equal,A.will decrease as the standard deviation decreases.C.will increase as the variance increases.E.22.The certainty equivalent rate of a portfolio isA.the rate that the investor must earn for certain to give up the use of his money.C.the rate that equates A in the utility function with the average risk aversion coefficient for all riskaverse investors.E.23.According to the meanvariance criterion, which of the statements below is correct?A.Investment B dominates investment C.C.Investment D dominates only investment B.E.24.Steve is more riskaverse than Edie. On a graph that shows Steve and Edie39。s indifference curves might intersect.II) Steve39。s.III) Steve39。s.IV) Steve and Edie39。s indifference curves will be downward sloping and Edie39。I and VB.III and IVD.II and IVinvestment opportunity set formed with a risky asset and a riskfree asset.B.line on which lie all portfolios that offer the same utility to a particular investor.D.26.Which of the following statements regarding the capital allocation line (CAL) is false?A.The slope of the CAL equals the increase in the expected return of the plete portfolio per unit of additional standard deviation.C.The CAL is also called the efficient frontier of risky assets in the absence of a riskfree asset.s optimal portfolio is the portfolio thatA.maximizes her risk.C.maximizes her expected utility.E.28.An investor invests 30% of his wealth in a risky asset with an expected rate of return of and a variance of and 70% in a Tbill that pays 6%. His portfolio39。None of the optionss expected return and standard deviation are __________ and __________, respectively.A. B. C. D. s expected return and standard deviation are __________ and __________, respectively.A. B. C. D. E.31.An investor invests 70% of his wealth in a risky asset with an expected rate of return of and a variance of and 30% in a Tbill that pays 5%. His portfolio39。32.You invest $100 in a risky asset with an expected rate of return of and a standard deviation of and a Tbill with a rate of return of .What percentages of your money must be invested in the risky asset and the riskfree asset, respectively, to form a portfolio with an expected return of ?A.75% and 25%C.57% and 43%E.33.You invest $100 in a risky asset with an expected rate of return of and a standard deviation of and a Tbill with a rate of return of .What percentages of your money must be invested in the riskfree asset and the risky asset, respectively, to form a portfolio with a standard deviation of ?A.50% and 50%C.40% and 60%E.34.You invest $100 in a risky asset with an expected rate of return of and a standard deviation of and a Tbill with a rate of return of .A portfolio that has an expected oute of $115 is formed byA.investing $80 in the risky asset and $20 in the riskfree asset.C.investing $43 in the risky asset and $57 in the riskless asset.E.35.You invest $100 in a risky asset with an expected rate of return of and a standard deviation of and a Tbill with a rate of return of .The slope of the capital allocation line formed with the risky asset and the riskfree asset is equal toA..C..E.36.Consider a Tbill with a rate of return of 5% and the following risky securities:Security A: E(r) = 。 Variance = Security C: E(r) = 。 Variance = From which set of portfolios, formed with the Tbill and any one of the four risky securities, would a riskaverse investor always choose his portfolio?A.The set of portfolios formed with the Tbill and security B.C.The set of portfolios formed with the Tbill and security D.E.37.You are considering investing $1,000 in a Tbill that pays and a risky portfolio, P, constructed with two risky securities, X and Y. The weights of X and Y in P are and , respectively. X has an expected rate of return of and variance of , and Y has an expected rate of return of and a variance of .If you want to form a portfolio with an expected rate of return of , what percentages of your money must you invest in the Tbill and P, respectively?A. B. C. D. E.38.You are considering investing $1,000 in a Tbill that pays and a risky portfolio, P, constructed with two risky securities, X and Y. The weights of X and Y in P are and , respectively. X has an expected rate of return of and variance of , and Y has an expected rate of return of and a variance of .If you want to form a portfolio with an expected rate of return of , what percentages of your money must you invest in the Tbill, X, and Y, respectively, if you keep X and Y in the same proportions to each other as in portfolio P?A. 。 C. 。 E.39.You are considering investing $1,000 in a Tbill that pays and a risky portfolio, P, constructed with two risky securities, X and Y. The weights of X and Y in P are and , respectively. X has an expected rate of return of and variance of , and Y has an expected rate of return of and a variance of .What would be the dollar values of your positions in X and Y, respectively, if you decide to hold 40% of your money in the risky portfolio and 60% in Tbills?A. $360B. $240C. $240D. $160E.40.You are considering investing $1,000 in a Tbill that pays and a risky portfoli