discrete distribatione)? d. What is stendaione rives thet the hat rat of the bond returt for the new leat to lewe it as it it. Norded these the ritk of the bund poetfilio it acceptable and wishes the ulandand deviatien of thent bas whet pou to wehistoncal neturna to ettimate trn arintad returnt.) the level of risk. Yoo sergest that the diest seli 25K of the Blindy stock and create do you suppose the clies will react as epplacing some of the Blasdy stock with high Filk socky Shone the client what the proposed partfulio return would have been in tion uef year of the carrple. Thers culcitate the werage teruen and staedand deviafulio coeppare with the rikk of the indivibal atedar if ther were held la isolation? B. Fiplain correlation to yoar dicez Calculale the eutimuted corriation between Tilandy and Gourmange. Does this cipiain why be portfolio stundard deviation was less than Blandy's seandud deriucion? h. Suppiose an itvector itarts with a pertiolio coesisting of one randomly selectid tappens to the portiolisis risk? 1. (1) Should portfodis etficts infertsce bow imestors think about the risk of indind. thal stocks? (2) If you decided to hold a ceec stadk portfolio and cucsequentiy were expoised to more risk than diverified invedien, could you erpect to be compeosited for all of your risks that is coeld yoe eum a rik premiam on thue part of your risk that you could have ctiminuted by chirnlfying? 5. According to the CAPM. what mranare the amount of rikk that an indinitual stockcontributes to a well-diversified porticliof Define this measuriement. k. What is the security matict line (SMO)? How is beta related to a stock's requircd rate of return? 1. Calculate the correqtion cocficicts between litandy and the market, Whe this and the previously calculated (or given) standard deviations of Blundy and the market to estimate Blandy's beta. Boes Mandf contribute more of less riak to a well-diversified portolio than does the arenge itock? Wie the SMII to ctimate Blandy's required seturm. m. Show how to eltimate beta usiog regresion analyis. R. (1) Suppose the risk free rate goes op to 7N. What effect would higher interest rates luve on the SMLL and on the cecurns tequirad on high and lone risk securitics? (2) Suppoie incted that imveitori rilk aceruice increased encagh to cause the market