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a. What are the expected return and standard deviation of stock Alpha and stock Xero? (6 Points) b. If you invest 40% of your own
a. What are the expected return and standard deviation of stock Alpha and stock Xero? (6 Points) b. If you invest 40% of your own money in stock Alpha and the rest in stock Xero, what is the expected return and standard deviation of your portfolio? (10 Points) c. What is the risk premium of a portfolio invests equally in stock Alpha, stock Xero, and risk-free asset if the T-bill now yields 3% in the economy? (3 Points)
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