26. A person is interested in constructing a portfolio. Two stocks are being considered. Let x= percent return for an investment in stock 1 , and y= percent return for an investment in stock 2. The expected return and variance for stock 1 are E(x)=8.45% and Var(x)= 25. The expected return and variance for stock 2 are E(y)=3.20% and Var(y)=1. The covariance between the returns is xy=3. a. What is the standard deviation for an investment in stock 1 and for an investment in stock 2 ? Using the standard deviation as a measure of risk, which of these stocks is the riskier investment? b. What is the expected return and standard deviation, in dollars, for a person who invests $500 in stock 1 ? c. What is the expected percent return and standard deviation for a person who constructs a portfolio by investing 50% in each stock? d. What is the expected percent return and standard deviation for a person who constructs a portfolio by investing 70% in stock 1 and 30% in stock 2 ? e. Compute the correlation coefficient for x and y and comment on the relationship between the returns for the two stocks