Expected return of Stock X Beta coefficient of Stock X Standard deviation of Stock X returns 9.50% 0.80 40.00% Expected return of Stock Y Beta coefficient of Stock Y Standard deviation of Stock Y returns 12.00% 1.10 25.00% Risk-free rate (TRF) Market risk premium (RPM) 6.00% 5.00% Dollars of Stock X in portfolio Dollars of Stock Y in portfolio $3,000.00 $4,000.00 Coefficient of Variation for Stock X Coefficient of Variation for Stock Y Formulas #N/A #N/A Riskier stock to a diviersified investor #N/A Required return for Stock X Required return for Stock Y #N/A #N/A Stock more attractive to a diversified investor #N/A Required return of portfolio containing Stocks X and Y in amounts above #N/A