Introduction: Recall the modern portfolio theory.
By the use of that theory we can determine the optimal portfolio for each investor. In this section we show we can apply this theory to a situation with a savings acount and one risky asset (Example 1 and Example 2), and to a situation with a savings acount and two risky assets.
By the use of that theory we can determine the optimal portfolio for each investor. In this section we show we can apply this theory to a situation with a savings acount and one risky asset (Example 1 and Example 2), and to a situation with a savings acount and two risky assets.