Teresa spends her entire budget and consumes 6 units of x and 20 units of y. The price of x is twice the price of y. Her income doubles and the price of y doubles, but the price of x stays the same.
If she continues to buy 20 units of y; what is the largest number of units of x that she can afford?

Two assets have the following expected returns and standard deviations when the risk-free rate is 5%: asset a e(ra) = 18.5% σa = 20% asset b e(rb) = 15% σb = 27% an investor with a risk aversion of a = 3 would find that on a risk-return basis. a. only asset a is acceptable b. only asset b is acceptable c. neither asset a nor asset b is acceptable d. both asset a and asset b are acceptable