QUESTION 1 Problem 6.1 (a) A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.6%. The probability distributions of the risky funds are: Stock fund (S) Bond fund (B) Expected Return 17% 8% Standard Deviation 46% 40% The correlation between the fund returns is 0.0600. What is the expected return for the minimum-variance portfolio of the two risky funds ? (Do not round intermediate calculations. Enter your answer in percentage points. Round your answers to 2 decimal places.) QUESTION 2 Problem 6.1 (b) A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.6%. The probability distributions of the risky funds are: Stock fund (S) Bond fund (B) Expected Return 17% 8% Standard Deviation 46% 40% The correlation between the fund returns is 0.0600. What is the standard deviation for the minimum-variance portfolio of the two risky funds ? (Do not round intermediate calculations. Enter your answer in percentage points. Round your answers to 2 decimal places.) QUESTION 3 Problem 6.2 (a) A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a long-term government and corporate bond fund, and the third is a T-bill money market fund that yields a sure rate of 5.5%. The probability distributions of the risky funds are: Stock fund (S) Bond fund (B) Expected Return 15% 9% Standard Deviation 32% 23% The correlation between the fund returns is 0.15. If the portfolio has to yield an expected return of 12%, what proportion must be invested in stocks? (Enter your answer in percentage points. Round your answer to 2 decimal places.)