J$.$P$.$ Morgan Asset Management publishes information about financial your answers to one decimal place.

$r=,{}_x+{}_y$

In percentage terms, what is the expected return and standard deviation for such a portfolio? Round your answers to two decimal places.

Expected return

$\%$

Standard deviation

e$.$ Which of the portfolios in parts $($b$),($c$),$ and $($d$)$ above has the largest expected return?

Which has the smallest standard deviation?

Which of these portfolios is the best investment alternative?

f$.$ Discuss the advantages and disadvantages of investing in the three portfolios in parts $($b$),($c$),$ and $($d$).$

If your goal is to have the largest return, which portfolio should you choose?

If your goal is to have the least risk, which portfolio should you choose?investments. Between $2002$ and $2011,$ the expected return for the S&P $500$ was $5\mathrm{.}04\%$ with a standard deviation of $19\mathrm{.}45\%$ and the expected return over that same period for a core bonds fund was $5\mathrm{.}78\%$ with a standard deviation of $2\mathrm{.}13\%.$ The publication also reported that the correlation between the S&P $500$ and core bonds is

$0\mathrm{.}32.$

You are considering portfolio investments that are composed of an S&P $500$ index fund and a core bonds fund.

$($a$)$

Using the information provided, determine the covariance between the S&P $500$ and core bonds.

$($b$)$

Construct a portfolio that is $50\%$ invested in an S&P $500$ index fund and $50\%$ in a core bonds fund. In percentage terms, what are the expected return and standard deviation for such a portfolio? $($Round your answer for the standard deviation to two decimal places.$)$

expected return

$\%$

standard deviation

$\%$

$($c$)$

Construct a portfolio that is $40\%$ invested in an S&P $500$ index fund and $60\%$ invested in a core bonds fund. In percentage terms, what are the expected return and standard deviation for such a portfolio? $($Round your answer for the standard deviation to two decimal places.$)$

expected return

$\%$

standard deviation

$\%$

$($d$)$

Construct a portfolio that is $60\%$ invested in an S&P $500$ index fund and $40\%$ invested in a core bonds fund. In percentage terms, what are the expected return and standard deviation for such a portfolio? $($Round your answer for the standard deviation to two decimal places.$)$

expected return

$\%$

standard deviation

$\%$

$($e$)$

Consider the portfolios in parts $($b$),($c$),$ and $($d$).$

Which of has the largest expected return?

The portfolio in

$---$Select$---$

has the largest expected return.

Which has the smallest standard deviation?

The portfolio in

$---$Select$---$

has the smallest standard deviation.

Which of these portfolios is the best investment?

The portfolio in

$---$Select$---$

is the best investment.Airline passengers arrive randomly and independently at the

passenger$-$screening facility at a major international airport. The

mean arrival rate is $11$ passengers per minute.

a$.$ Compute the probability of no arrivals in a one$-$minute period $($to $6$

decimals$).$

b$.$ Compute the probability that three or fewer passengers arrive in a

one$-$minute period $($to $4$ decimals$).$

c$.$ Compute the probability of no arrivals in a $15-$second period $($to $4$

decimals$).$

d$.$ Compute the probability of at least one arrival in a $15-$second

period $($to $4$ decimals$).$your answers to one decimal place.

$r=,{}_x+{}_y$

In percentage terms, what is the expected return and standard deviation for such a portfolio? Round your answers to two decimal places.

Expected return

$\%$

Standard deviation

e$.$ Which of the portfolios in parts $($b$),($c$),$ and $($d$)$ above has the largest expected return?

Which has the smallest standard deviation?

Which of these portfolios is the best investment alternative?

f$.$ Discuss the advantages and disadvantages of investing in the three portfolios in parts $($b$),($c$),$ and $($d$).$

If your goal is to have the largest return, which portfolio should you choose?

If your goal is to have the least risk, which portfolio should you choose?Core Bonds fund.

negative numbers.

answers to one decimal place.

$r=,{}_{x+}$

In percentage terms, what is the expected return and standard deviation for such a portfolio? Round your answers to two decimal places.

Expected return

$\%$

Standard deviation

$\%$

your answers to one decimal place.

$r=,{}_{x+}$

In percentage terms, what is the expected return and standard deviation for such a portfolio? Round your answers to two decimal places.

Expected return

$\%$

Standard deviation