Please show all calculations.

5.We construct four portfolios by investing different weights in two stocks. The expected return and standard deviation of their returns of these portfolios are given below.

PortfolioExpectation ReturnStandard Deviation

W8.25%20%

X8.75%15%

Y 8.50%20%

Z9.00%15%

Which of the following portfolios is on the efficient frontier ?_____

1. Only portfolio W is on the efficient frontier.
2. Only portfolio X is on the efficient frontier.
3. Only portfolio Y is on the efficient frontier.
4. Only portfolio Z is on the efficient frontier.

8. Assume that investors can borrow and lend at risk-free rate of 5%. The optimal tangent portfolio on the efficient frontier has an expected return of 15%, and STD (standard deviation) of 20%. John would like to construct his complete investment portfolio by allocating funds between the risk-free asset and the optimal tangent portfolio. Which of the following complete portfolios can John NOT achieve? ______

1. Portfolio A with E(R)=17.5% and STD=25%.
2. Portfolio B with E(R)=13% and STD=18%.
3. Portfolio C with E(R)=10% and STD=10%.
4. Portfolio D with E(R)=5.5% and STD=1%.
5. None of the above.