Unformatted text preview: ity, regardless of return (as long as it’s positive, of course). You may invest in the following assets: Asset Expected Return Standard Deviation A 20% 20% B 5% 10% If σ A,B =. 5, what should you do? (a) Invest solely in A. (b) Invest solely in B (c) Invest in a mix of A & B; see RWJ Ch 10.3 for a discussion on the beneﬁts of diversiﬁcation; in particular, p. 289 (d) Not enough information to answer the problem....
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 Spring '08
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 Depreciation, 10%, 5%, 20%, depreciation tax shield

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