Consider two risky investments with the following return distributions:

Probability	Return R1 (p.a.)
0.25 0.30 0.25 0.20	+12% +4% 5% 8%
Expected return	1 = 1.3500%
Volatility	1 = 7.6176%

Probability	Return R2 (p.a.)
0.30 0.30 0.20 0.20	+10% +8% +3% 15%
Expected return
Volatility

The correlation between the returns of the two investments is ₁₂ = 0.9.

1. (a) Calculate ₂ and ₂. (Read the Instructions carefully.)

2. (b) Express the portfolio squared volatility P₂ in terms of w1, the weight of the first investment. (Round the coefficients to 6 decimals.)

3. (c) Using your answer in part (b), find the weight w₁ of the minimum-risk portfolio. Hence, find the expected return _P and volatility _P of the minimum-risk portfolio.