Exhibit 78
Use the Information Below for the Following Problem(S)

Multiple Choice

Exhibit 7.8
Use the Information Below for the Following Problem(S)
$$\begin{array} { c c } Asser (A) & \text { Asset ( B) } \\\mathrm { E } \left( R _ { A } \right) = 1 [ \% & \mathrm { E } \left( \mathrm { R } _ { B } \right) = 14 \% \\\left( \sigma _ { A } \right) = 7 / & \left( \sigma _ { B } \right) = 8 \% \\W _ { A } =0 .7 & W _ { B } = 0 .3 \\C O V _ { A , B } = 0 .0013\end{array}$$
-Refer to Exhibit 7.8.What is the expected return of a portfolio of two risky assets if the expected return E(R?) ,standard deviation (s?) ,covariance (COV?,?) ,and asset weight (W?) are as shown above?

A) 6.4%
B) 9.1%
C) 10.2%
D) 10.8%
E) 11.2%