3. Consider a market that consists of 4 stocks with the following data: 0.3 0.2 -0.2 0.1 and C 0.0032 0.002 0.002 0.01 0.00312 0.0072 0.0 -0.001 0.00312 0.0072 0.0169 0.0 0.0 0.001 0.0 0.01 Assume that the risk-free interest rate is R = 10% 1 (a) (8 Points) Write the expressions for the CML (Capital Market Line) and SML (Security Market Line) (b) (8 Points) What is the beta of each stock? What are the correlation coefficients between the Market Portfolio and each of the given four stocks? (c) (9 Points) Let V be a portfolio with return 0.15, not necessarily efficient. What is the covariance between this portfolio and the market portfolio? If V is efficient, find its variance