CH12 1. Stocks A and B have the following returns: Stock A 0.11 0.06 0.15 Stock B 0.05 0.03 0.05 0.02 -0.04 0.08 0.05 a. What are the expected returns of the two stocks? b. What are the standard deviations of the returns of the two stocks? c. If their correlation is 0.48, what is the expected return and standard deviation of a portfolio of 61% stock A and 39% stock B? 2. Stocks A and B have the folowing returns: Stock A Stock B 0.06 0.02 0.05 0.01 -0.02 0.10 0.07 0.15 -0.05 0.08 a. What are the expected returns of the two stocks? b. What are the standard deviations of the returns of the two stocks? c. If their correlation is 0.46, what is the expected return and standard deviation of a portfolio of 70% stock A and 0% stock B? 3. Fremont Enterprises has an expected return of 15% and Laurelhurst News has an expected return of 25%. If you put 46% of your portfolio in Laurelhurst and 54% in Fremont, what is the expected return of your portfolio? The expected return on the portfolio is