Consider two perfectly negatively correlated risky securities, K and L. K has an expected rate of return of 12% and a standard deviation of 17%. L has an expected rate of return of 9% and a standard deviation of 11%. The risk-free portfolio that can be formed with the two securities will earn _____ rate of return.
A) 9.5%
B) 10.18%
C) 10.9%
D) 9.9%
E) None of the options are correct.

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The Answer of Consider two perfectly negatively correlated risky securities, K and L. K has an expected rate of return of 12% and a standard deviation of 17%. L has an expected rate of return of 9% and a standard deviation of 11%. The risk-free portfolio that can be formed with the two securities will earn _____ rate of return.
A) 9.5%
B) 10.18%
C) 10.9%
D) 9.9%
E) None of the options are correct.

Consider Two Perfectly Negatively Correlated Risky Securities, K and L