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Hi!I want the solution for part II ( all questions) of this homework that I have attached! Thank you MeltBulu-Taciroglu Wintert2016tENGt111t-tHWt8 YOUtCANtSUBMITtANtEXCELtFILEtFORtTHIStASSIGNMENT Due:tMarcht11,t11:00pm ParttI (40

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Hi!I want the solution for part II ( all questions) of this homework that I have attached! Thank you

image text in transcribed Mel\tBulu-Taciroglu Winter\t2016\tENG\t111\t-\tHW\t8 YOU\tCAN\tSUBMIT\tAN\tEXCEL\tFILE\tFOR\tTHIS\tASSIGNMENT Due:\tMarch\t11,\t11:00pm Part\tI (40 points) Suppose you are thinking of investing on Greek government bonds. Each Greek bond will pay $80.00 at the end of every year for 4 years. At the end of 4th year, each bond will also pay back the principal of $1000. Today is the 1st day of year 1. a) What is the coupon rate of this bond? b) What is the price of such a bond if the promised yield is 15%? c) Greece has some probability of going bankrupt within 1 year. Suppose that the probability of Greek default is 30% and if Greece defaults, assume that it will only pay 50% (this is called a \"hair cut\") of the agreed amount of coupon and principal payments in that and the subsequent years. Alternatively, you can invest on a 4-year US bond with 4% coupon and $1,000 face value that sell for $964.54 today. At most how much would you pay for a Greek bond given the information provided in parts (a), (b), and (c)? Part\tII\t(60 points) Calculate the monthly return of the stocks of Amazon and Walmart, each, from Jan 4, 2010 to March 2, 2016. (Yahoo Finance provides monthly returns! Go to Historic Prices on left side of Yahoo Finance page for the company, say Walmart, and use the prices given under \"adjusted close\") 1. What is the monthly expected return and the standard deviation of a portfolio that is composed of a) 10% Amazon, 90% Walmart? b) 20% Amazon, 80% Walmart? c) 30% Amazon, 70% Walmart? d) 40% Amazon, 60% Walmart? e) 50% Amazon, 50% Walmart? f) 60% Amazon, 40% Walmart? g) 70% Amazon, 30% Walmart? h) 80% Amazon, 20% Walmart? i) 90% Amazon, 10% Walmart? 2. What is the composition of a portfolio that is comprised of Amazon and Walmart stocks and that has the lowest standard deviation? 3. You have $10K. What is the expected value and the standard deviation of a portfolio that is formed by investing $5K at the risk free rate and $5K on the portfolio you found in question 2 (assume that monthly risk free rate is 0.0025)

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