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Q1. Here are returns and standard deviations for four investments. Treasury Bills Stock P Stock Q Stock R Return (%) 6 10 14.5 21 Standard

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Q1. Here are returns and standard deviations for four investments. Treasury Bills Stock P Stock Q Stock R Return (%) 6 10 14.5 21 Standard Deviation (%) 0 14 28 26 i. Calculate the Standard Deviation of the following portfolios: a. 50% in Treasury bills, 50% in stock P b. 50% each in Q and R, assuming the shares have Perfect positive correlation Perfect negative correlation No correlation . . ii. Stock Q has a lower return than R but a higher standard deviation. Does that mean that Q's price is too high or that R's price is too low

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