Consider historical data showing that the average annual rate of return on the S&P 500 portfolio over the past 85 years has averaged roughly 8% more than the Treasury bill return and that the S&P 500 standard deviation has been about 31% per year. Assume these values are representative of investors' expectations for future performance and that the current T-bill rate is 3%.

calculate he expected return and variance of portfolios invested in T-bills and the s&P 500 index with weights as shown below

w bills

0.0,.2,.4,.6,.8,1.0

Windex

1.0,.8,.6,.4,.2,0