1. What type of investment is the Worldwide Paper Company interested in making? Addition of 100 hectares of land to grow wood Increase in research and design spending to create a novel wood saw Purchase of new tractors to ferry around wood Addition of an on-site longwood woodyard Takeover of Shenandoah Mill.
2. You manage an equity fund with an expected risk premium of 13.2% and a standard deviation of 46%. The rate on Treasury bills is 4.6%. Your client chooses to invest $105,000 of her portfolio in your equity fund and $45,000 in a T-bill money market fund. What is the reward-to-volatility ratio for the equity fund? (Round your answer to 4 decimal places.)