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Problem 6 - 5 ( Algo ) The standard deviation of the market - index portfolio is 3 5 % . Stock A has a

Problem 6-5(Algo)
The standard deviation of the market-index portfolio is 35%. Stock A has a beta of 1.40 and a residual standard deviation of 45%.
Required:
a. Calculate the total variance for an increase of 0.20 in its beta. (Do not round intermediate calculations.)
Total variance
b. Calculate the total variance for an increase of 3 percentage points in its residual standard deviation. (Do not round intermediate calculations.)
Total variance
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