#7 a. Discuss a standard IOL, and how the choices of 1) a very risk averse...

#7

a. Discuss a standard IOL, and how the choices of 1) a very risk averse investor, 2) an investor with 'normal' risk aversion, and 3) a risk seeking investor will differ.

b. Explain how money fits in a portfolio decision (as a risk asset). In answering, show how money (as a riskless asset) alters the IOL and show an equilibrium holding of money and bonds.

c. Compare and contrast the bracketed term in the IOL to the beta famous in finance.

Expert Solution

Rahul Sunny answered 1 year ago

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