Download the historical prices for Apple, Microsoft, and the stock market $($choose an index of

your preference$)$ for the past $10$ years.

$1)$ Calculate returns for the two stocks and the index. If the return data you have is

monthly returns, average the monthly returns to get yearly returns. Make a chart to

display your summary data, as well as a graph that lays out the three different returns.

$2)$ Calculate Beta for Apple and Microsoft, using a characteristic line. Display the data

points on a graph and display the characteristic line.

$3)$ Using CAPM, calculate the Expected Return for Apple and Microsoft. Get the relevant

market related data, such as the $$risk$-$free rate$$ and $$market return$,$ and describe

which rate you are using from the financial markets.

$4)$ Imagine you are supposed to create a portfolio using Apple and Microsoft, using

$$1,000,000.$ How much do you need to invest in each stock, so that your portfolio risk is:

a$.$ equal to market risk.

b$.$ equal to $1\mathrm{.}5$ times the market risk.

c$.$ equal to twice the market risk.

d$.$ the lowest possible risk with the two stocks you have.

$5)$ Display your calculations using a table to show $ amounts invested in each stock, your

total portfolio value, portfolio weights, your final calculation for portfolio beta, and the

expected portfolio return using CAPM input you collected for Part $(3).$