What will be the standard deviation and the rate of return

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A bank will allow you to borrow -- at 8% -- up to the amount of your own money that you commit to the project (i.e., if you invest, say $10 of your own money, you can borrow another $10 to do the same). (a) What will be the standard deviation and the rate of return (ROR) on your portfolio if you borrow the maximum amount? (b) You decide to invest $100 of your own funds and invest another $100 more of borrowed funds. What will be your wealth position at the project's close if state 3 occurs?

Reference no: EM131184997

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