6. Suppose Southwest Airlines' stock offers an expected return of 10% and a standard deviation of 20\%. Suppose American Airlines' stock offers an expected return of 8% and a standard deviation of 16%. The correlation between American's stock and Southwest's stock is -0.1 . The risk-free rate is 5%. 2 (a) Graph Capital Allocation Lines (CAL) for Southwest and American on the same graph. (b) Derive and graph (on the same graph from (a)) the CAL for a risky portfolio created by putting portfolio weights of 0.5 on Southwest and 0.5 on American. (c) If you can only invest in one of the airlines or the portfolio from (b) along with the risk-free security, which security (which airline stock or the portfolio from (b) will a risk averse investor choose? Why? (d) If your friend is less risk averse than you, which airline stock or the portfolio from (b) will she choose to invest along with the risk-free security? Why