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9 Suppose that many stocks are traded in the market and that it is possible...

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9 Suppose that many stocks are traded in the market and that it is possible to borrow at the risk-free rate, ty The characteristics of two of the stocks are as follows: Stock Expected return Standard Deviation 81 400 points Correlation-1 Book Print a. Calculate the expected rate of return on this risk free portfolio? (Hint: Can a particular stock portfolio be substituted for the risk-free asset?) kerences Rate of return % b. Could the equilibrium ; be greater than 10%? Yes O No

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