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Answer the following questions using the data in the table below: Risk free Rate 3% Company Expected Return Risk Giants 14% 20% Colts 11% 15%

Answer the following questions using the data in the table below:

Risk free Rate 3%

Company Expected Return Risk
Giants 14% 20%
Colts 11% 15%
Dolphins 8% 9%

a. Which portfolio above would be considered the market portfolio? Show why

b. What combination on the capital market line will produce a return of 6%? Comment on this portfolio (weighting); with regards to what it represents and how you would achieve it (construction)

c. What combination will produce a return of 15%? Comment on this portfolio (weighting); with regards to what it represents and how you would achieve it (construction)

d. What is the risk (as measured by standard deviation) of the portfolio you calculated in b and c?

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