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P8-3 (similar to) Question Help (Computing the standard deviation for a portfolio of two risky Investments Mary Gulott recently graduated from Nichols State University and

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P8-3 (similar to) Question Help (Computing the standard deviation for a portfolio of two risky Investments Mary Gulott recently graduated from Nichols State University and is ardous to begin investing her meager savings as a way of applying what she has inarned in business school. Specifically, she is evaluating an investment in a portfolio comprised of two firm' common stock. She has collected the following infomation about the common stock of Fim A and If Mary invests hall her money in each of the two common stocks, what is the portfolio's expected rate of retum and standard deviation in portoforetum b. Answer part a where the correlation between the two common stock investments is equal to zero. c. Answer part a where the correlation between the two common stock investments is equal to 1. d. Answer part where the correlation between the two common stock investments is equal to 1. . Using your responses to questions, describe the relationship between the correlation and the risk and return of the portfolio 2. If Mary decides to invest 50% of her money in Form As common stock and 50% in Firm's common stock and the correlation between the two stocks is 0.40, then the expected rate of retum in the portfolio is SS. Round to be decimal places.) The standard deviation in the portfolio in 1500 Pound to two decimal places) b. Mary decides to invest 50% of the money in Form As common stock and 50% in Pim Ws common stock and the correlation between the two locks is zero, then the expected rate of retum in the portato is found to two decir places) The standard deviation in the portfolio 3 Round in two decimal places) c. Mwy decides to invest 80% of her money in Form A's common stock and 50% in Pom l's common stock and the correlation coefficient between the two stocks is, then the expected to return in the portate and the decimal places) The standard deviation in the portions and to two decimal plom Enter your answer in the answer box and then click Check Answer Clear All 3 parts remaining HUIUUIOR non stock and 50% in Firm B's common stock and the correlation between the two stocks is 0.40, then the expect Data Table X wo ded mon sta wo ded Expected Return 0.18 0.19 0.40 Standard Deviation 0.15 0.22 Firm A's common stock Firm B's common stock Correlation coefficient non sto decimal Print Done

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