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QUESTION
The risk-free rate is 6%. An investor has the following utility function:
hello,
A portfolio has an expected rate of return of 14% and a standard deviation of 22%. The risk-free rate is 6%. An investor has the following utility function:
U = E(r)-1/2(A)σ2
Which value of A makes this investor indifferent between the risky portfolio and the risk-free asset?
