【正文】 o, 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 value of your positions in X, Y, and the Tbills, respectively, if you decide to hold a portfolio that has an expected oute of $1,120?A.$568。 $54C. $54。$378。 $568E. $514。41.A rewardtovolatility ratio is useful inA.understanding how returns increase relative to risk increases.C.assessing the effects of inflation.E.42.The change from a straight to a kinked capital allocation line is a result ofA.borrowing rate exceeding lending rate.C.s risk tolerance decreasing.D.43.The first major step in asset allocation isA.analyzing financial statements.C.identifying market anomalies.investors will hold varying amounts of the risky asset in their portfolios.B.investors will hold varying amounts of the riskfree asset in their portfolios.D.45.Asset allocation may involveA.the decision as to the allocation among different risky assets.C.the decision as to the allocation between a riskfree asset and a risky asset and the decision as to the allocation among different risky assets.E.46.In the meanstandard deviation graph, the line that connects the riskfree rate and the optimal risky portfolio, P, is calledA.the capital allocation line.C.the investor39。47.Treasury bills are monly viewed as riskfree assets becauseA.the inflation uncertainty over their time to maturity is negligible.C. desired holding periods.D.the inflation uncertainty over their time to maturity is negligible and their term to maturity is identical to most investors39。48.Your client, Bo Regard, holds a plete portfolio that consists of a portfolio of risky assets (P) and TBills. The information below refers to these assets.What is the expected return on Bo39。%B.%D.%s plete portfolio?A.%C.%E.50.Your client, Bo Regard, holds a plete portfolio that consists of a portfolio of risky assets (P) and TBills. The information below refers to these assets.What is the equation of Bo39。E(rC) = + Standard Deviation of CB.E(rC) = + Standard Deviation of CD.E(rC) = + Standard Deviation of Cs plete portfolio?A.8%, 5%, 7%C.16%, 10%, 14%E.52.To build an indifference curve we can first find the utility of a portfolio with 100% in the riskfree asset, thenA.change the expected return of the portfolio and equate the utility to the standard deviation.C.change the standard deviation of the portfolio and find the expected return the investor would require to maintain the same utility level.E.53.The capital market lineI) is a special case of the capital allocation line.II) represents the opportunity set of a passive investment strategy.III) has the onemonth TBill rate as its intercept.IV) uses a broad index of mon stocks as its risky portfolio.A.II, III, and IVC.I, II, and IIIE.54.An investor invests 35% of his wealth in a risky asset with an expected rate of return of and a variance of and 65% in a Tbill that pays 4%. His portfolio39。55.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 3%. His portfolio39。None of the options85% and 15%B.% and %D.Cannot be determined30% and 70%B.60% and 40%D.Cannot be determined.B..D.Cannot be determined% and %B.% and %D.Cannot be determined30% and 70%B.60% and 40%D.Cannot be determined.B..D.Cannot be determined% and %B.% and %D.Cannot be determined301% and %B.% and %D.Cannot be determinedinvesting $100 in the risky asset.B.borrowing $46 at the riskfree rate and investing the total amount ($146) in the risky asset.D.Such a portfolio cannot be formed..B..D.Cannot be determinedShort Answer Questionss attitude toward speculation and risk and how the utility function reflects this attitude.69.Draw graphs that represent indifference curves for the following investors: Harry, who is a riskaverse investor。 and Ozzie, who is a riskloving investor. Discuss the nature of each curve and the reasons for its shape.70.Toby and Hannah are two riskaverse investors. Toby is more riskaverse than Hannah. Draw one indifference curve for Toby and one indifference curve for Hannah on the same graph. Show how these curves illustrate their relative levels of risk aversion.71.Discuss the characteristics of indifference curves, and the theoretical value of these curves in the portfolio building process.72.Describe how an investor may bine a riskfree asset and one risky asset in order to obtain the optimal portfolio for that investor.73.The optimal proportion of the risky asset in the plete portfolio is given by the equation y* = [E(rP) rf]/(.01A times the variance of P). For each of the variables on the right side of the equation, discuss the impact of the variable39。s fund?c. Draw the CML and the CAL on one graph.d. What is the maximum fee your broker could charge and still leave you as well off as if you had invested in the passive market fund? (Assume that the fee would be a percentage of the investment in the broker39。1.Which of the following statements regarding riskaverse investors is true?A.They accept investments that are fair games.C.