Ms. Gambling chooses a risky portfolio, P, with an expected return of 0.20 and a standard deviation of 0.18. The risk-free rate equals .05. She wants to invest 30% in RF and 70% in P.
a) What is the RF-P portfolio's expected return?
b) What is the RF-P portfolio's standard deviation
c) What is the CML equation for the risky portfolio P and the risk-free asset, RF?