Dawson Private Limited has constructed a complete investment portfolio on financial markets where other competing investors have also constructed a variety of own investment portfolios. The company...

Dawson Private Limited has constructed a complete investment portfolio on financial markets where other competing investors have also constructed a variety of own investment portfolios. The company faces a risk-free rate of return of 10% and a market return of 18%.

a) Determine the utility the corporation would draw from constructing a portfolio with a variance of 16% and given that its corresponding risk aversion coefficient A = 4;

b) Calculate the utility that the firm would generate from a portfolio investment with a variance of:

(i) 25%given that its risk aversion coefficient is 4 and the expected return is 15%;

(ii) 36%given that its risk aversion coefficient is 8 and the expected return is 16%;

(iii) 64% given that its risk aversion coefficient is 10and the expected return is 20%. Appraise your findings.