You want to save to buy a laptop that costs $1,981. Therefore, you deposit $484 into a bank that pays 6% interest compounded semiannually. How many year will it take for you to buy the laptop in your shopping list? Please, explain. Please round your answer to the second decimal, e.g. 1.5 (year).
You manage a risky portfolio with an expected rate of return of 17% and a standard deviation of 28%. The T-bill rate is 7%.
Your client chooses to invest 60% of a portfolio in your fund and 40% in an essentially risk-free money market fund. What is the expected return and standard deviation of the rate of return on his portfolio? (Do not round intermediate calculations. Round "Standard deviation" to 1 decimal place.)
Rate of Return
Expected return %
Standard deviation %