Chapter 8- index model 1-Suppose that the index model for the excess retums of stocks A and B is estimated with the following results: Ru= 1.0%+.9RuteA Ru -2.0%+ 1.1 Rutes Om#20% o(ea)-30% o(e)-10% A) Find the standard deviation of each stock B) Covariance between them. 2-A portfolio manager provided with following tables of micro forecast and macro forecast: Micro Asse stock A stock B 20 18 17 12 58 71 60 1.8 0.7 stock D Macro Asset T-blls assive folio 16 23