6. Suppose the index model for stocks 1 and 2 has the following results R1 = 2% + 0.8R_m + e₁, R2 = -1% + 1.1R_m + e₂, ??_m= 20%. The standard deviations of e1 and e2 are 20% and 25% respectively. (20 marks) (1) Calculate the standard deviation of stock 1 and stock 2. (5 marks) (2) What is the covariance between each stock and the market index. (5 marks) (3) What are the covariance and correlation coefficient between these two stocks? (5 marks) (4) Break down the variance of each stock into its systematic and firm-specific component. (5 marks).