***PLS show all workings and formula in Excel***

1. Miss Maple is considering two securities, A and B, with the relevant information given below,

State of the economy	Probability	Return on Security A (%)	Return on Security B (%)
Bear	0.4	3.5%	6.50%
Bull	0.6	16.50%	6.50%

a. Calculate the expected return and standard deviation of each of the two securities. b. Suppose Miss Maple invested $2,500 in security A and $3,500 in security B. Calculate the ex- pected return and standard deviation of the portfolio.

2. The following table contains annual returns for the stocks of Amazon (AMZN) and Anheuser-Busch InBev SA/NV (BUD). The returns are calculated using end-of-year prices (adjusted for dividends and stock splits) retrieved from finance.yahoo.com.

Year	Amazon.com, Inc. (AMZN)	Anheuser-Busch InBev SA/NV (BUD)
2010	35.27%	12.28%
2011	14.62%	12.03%
2012	36.55%	48.98%
2013	35.10%	11.58%
2014	-1.16%	31.13%
2015	65.57%	6.48%
2016	52.94%	1.61%
2017	76.19%	12.69%
2018	18.46%	-30.10%
2019	16.87%	0.90%
2020	59.61%	-15.95%

a. Use Excel to setup a spreadsheet that calculates annual portfolio returns for an equally weighted AMZN and BUD portfolio.

b. Calculate the average annual return for both stocks and the portfolio.

c. Calculate the standard deviation of annual returns for AMZN, BUD, and the equally weighted portfolio of AMZN and BUD.

d. Calculate the correlation coefficient for AMZN and BUD annual returns.

e. Set up a table in Excel that calculates returns for portfolios comprised of AMZN and BUD using the following, respective, weightings: (1.0, 0.0), (0.9, 0.1), (0.8, 0.2), (0.7, 0.3), (0.6, 0.4), (0.5,0.5), (0.4, 0.6), (0.3, 0.7), (0.2, 0.8), (0.1, 0.9), and (0.0, 1.0). Also, calculate the portfolio standard deviation associated with each portfolio composition. You will need to use the standard deviations found previously for AMZN and BUD and their correlation coefficient.

f. Identify the weights associated with the portfolio of minimum variance.

g. Graph the relationship return/risk associated with each of the weights in (e)

Note: When you create Excel's initial table, pls work with decimal places or the decimal places formatted as a percentage in Excel. For example, in 2020, you should input in Excel "0.5961" and "-0.1595".