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Sagot :
If the values of stock a and stock b is given as below, the investment in both the risky assets be as below:
- stock a with 100 shares outstanding and a price per share of $120
- stock b with 150 shares outstanding and a price per share of $80
So, if an investor invests $1000 in the optimal risky portfolio one should invest the following amount in each of the 2 risky assets=
100*120 which is $12000 should be the total value of the stock a
80*150 which is $12000 should be the total value of the stock b
Now, since both are of equal value the investor can invest half in each stock which $500 in both stock a and stock b.
Learn more about risky assets here brainly.com/question/17422326
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