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  3. 1) (20 points. consider a risk-free security with

1) (20 points. Consider a risk-free security with return R = 5%. Consider also three...

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Accounting

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1) (20 points. Consider a risk-free security with return R = 5%. Consider also three risky portfolios A, B and C with expected returns 15%, 20%, and 25%, respectively, and standard deviations 5%, 10%, and 14%, respectively. Suppose that you can invest in the risk-free security and only one of the portfolios. Which portfolio (among the three of them) would you select

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