Question 2 (Essential to cover) Consider risk measures on the following 3 large cap stocks: Stock Beta (B) Standard Deviation (0) Berkshire Hathaway (BRK) 0.69 23.50% Apple (APPL) 1.15 24.00% Microsoft (MSFT) 1.28 22.80% The standard deviation of the Market Portfolio Om= 15.3% a. Calculate the systematic and unsystematic risk of BRK, APPL and MSFT. b. What is BRK's covariance and correlation with the Market Portfolio's return? c. Calculate the following covariances: CoV(BRK,APPL), Cov(BRK,MSFT), Cov(APPLMSFT) d. Consider an equally weighted portfolio of BRK and APPL. Calculate the portfolio's total risk (i.e. variance), systematic risk and unsystematic risk? Verify that oer = e. Consider an equally weighted portfolio of all three stocks. Calculate the portfolio's total risk (i.e. variance), systematic risk and unsystematic risk? Verify that op van 10 What happens to unsystematic risk as the number of assets becomes very large