1 Ebenezer Scrooge has invested 65% of his money in share A and the remainder in share B. He assesses their prospects as follows: Expected return (%) Standard deviation (%) Correlation between returns Expected return Standard deviation a. What are the expected return and standard deviation of returns on his portfolio? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) Standard deviation A 15 21 16.40 % 3.80 % Correlation Coefficient 0 0.5 b. How would your answer change if the correlation coefficient were 0 or -0.50? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.) 2.40% B 19 21 Correlation Coefficient -0.50 X%

Ebenezer Scrooge has invested 65% of his money in share A and the remainder in share B. He assesses their prospects as follows: a. What are the expected return and standard devlation of returns on his portfolio? (Do not round intermediate calculations. Enter your answers as o percent rounded to 2 decimal places.) b. How would your answer change if the correlation coefficient were 0 or-0.50? (Do not round intermediate colculations. Enter your onswers as a percent rounded to 2 decimal places.)