Ebenezer Scrooge has invested 65% of his money in share A and the remainder in share B. He assesses their prospects as follows:

	A		B
Expected return (%)	15		19
Standard deviation (%)	21		21
Correlation between returns		0.5

a. What are the expected return and standard deviation of returns on his portfolio? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

b. How would your answer change if the correlation coefficient were 0 or 0.50? (Do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.)

c. Is Mr. Scrooges portfolio better or worse than one invested entirely in share A, or is it not possible to say?

• Better

• Worse

• Not possible to say