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What is the equation of the cml

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Problem 1: Two capital assets display the following: E(R%) = 12% σ% = 1.5%E(R&) = 15% σ& = 1.0% If asset A ´s return is 5% below the Capital Market Line (CML), and asset B ´s return is 1% below the CML, what is the equation of the CML?

a) E(R!) = 0.1203 - 0.02σ!

b) E(R!) = 0.09 + 2σ!

c) E(R!) = 0.1227 + 0.02σ!

d) E(R!) = 0.15 - 2σ!

e) E(R!) = 0.14 + 2σ!

Reference no: EM132928938

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