Suppose Ford Motor stock has an expected return of 15% and a volatility of 42%, and Molson-

Coors Brewing has an expected return of 11% and a volatility of 32%. If the two stocks are uncorrelated,

a. What is the expected return and volatility of a portfolio consisting of 73% Ford Motor stock and 27% of Molson-Coors Brewing stock?

b. Given your answer to part

a, is investing all of your money in Molson-Coors stock an efficient portfolio of these two stocks?

c. Is investing all of your money in General Motors an efficient portfolio of these two stocks?

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