Compute this portfolio expected return


Problem: You can invest in a portfolio that has an expected return of 8% and a standard deviation of 0.10. You can also borrow and lend any amount at the risk free rate of 3%.

1) Create a portfolio that will have a standard deviation of 0.15 and compute this portfolio's expected return.

2) If the portfolio is the market portfolio, write the Capital Market Line.

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Finance Basics: Compute this portfolio expected return
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