Mr Watson has savings of 12,000. Of this amount he has invested 6,000 in Treasury Bills which currently yield a return of 6%. The remainder has been invested in a portfolio of four different companies shares. Details of this portfolio are as follows:

Company	Expected Return	b shares	Worth of share holding
W	7.6%	0.20	1,200
X	12.4%	0.80	1,200
Y	15.6%	1.20	1,200
Z	18.8%	1.60	2,400

1. Calculate the expected return and beta (b) value of Mr Watsons savings portfolio.
2. Mr Watson has decided that he wants an expected return of 12% on his savings portfolio. Show how he would achieve this by selling some of his Treasury Bills and investing the proceeds in the market portfolio.
3. If Mr Watson were only to invest in Treasury Bills and the market portfolio, what savings portfolio would be required to give him an expected return of 10.32%?