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What is the reward-to-volatility ratio in borrowing region

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Problem 1: An investor has US$50,000 to invest. She borrowed an additional US$10,000 at 5% rate and invest the entire amount in a risky portfolio. Risk-free rate is 2% in the lending region and 4% in the borrowing region, and return and standard deviation of the risky portfolio are 11% and 20% respectively. What is the reward-to-volatility ratio in the borrowing region.

Reference no: EM132964466

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