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Question 1 (Risk, Return and Diversification) (40 marks) a. The following are monthly rates of return for two companies during a six-month period: Compute the

Question 1 (Risk, Return and Diversification) (40 marks) a. The following are monthly rates of return for two companies during a six-month period: Compute the following. i. Average monthly rate of return Ri for each stock ii. Standard deviation of returns for each stock iii. Covariance between the rates of return (20 marks)

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