Your available wealth for investment is $850,000. Both the risk-free rate and your borrowing rate...
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Accounting
Your available wealth for investment is $850,000. Both the risk-free rate and your borrowing rate are 8%. The return on the risky portfolio is 16%. If you wish to earn a 21% return, you should
a. borrow $531,250
b. invest $318,750 in the risk-free asset
c. invest $531,250 in the risk-free asset
d. borrow $318,750
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