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QUESTION 2 Investors can form complete portfolios out of 2 assets. A T-bill with a return of 5%, and a risky portfolio with an expected return of 15% and a return volatility of 20%. An investor invests 20% of his complete portfolio in the T-bill and the remaining 80% in the risky portfolio. What is the risk premium of his complete portfolio? O 5.5% O 6% O 10% O 8%

QUESTION 2 Investors can form complete portfolios out of 2 assets. A T-bill with a return of 5%, and a risky portfolio with an expected return of 15% and a return volatility of 20%. An investor invests 20% of his complete portfolio in the T-bill and the remaining 80% in the risky portfolio. What is the risk premium of his complete portfolio? O 5.5% O 6% O 10% O 8%

Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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**Question 2** Investors can form complete portfolios out of 2 assets. A T-bill with a return of 5%, and a risky portfolio with an expected return of 15% and a return volatility of 20%. An investor invests 20% of his complete portfolio in the T-bill and the remaining 80% in the risky portfolio. What is the risk premium of his complete portfolio? - ○ 5.5% - ○ 6% - ○ 10% - ○ 8%
Transcribed Image Text:**Question 2** Investors can form complete portfolios out of 2 assets. A T-bill with a return of 5%, and a risky portfolio with an expected return of 15% and a return volatility of 20%. An investor invests 20% of his complete portfolio in the T-bill and the remaining 80% in the risky portfolio. What is the risk premium of his complete portfolio? - ○ 5.5% - ○ 6% - ○ 10% - ○ 8%
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