Question 3 (22 marks) (a) Michael Bank has a portfolio which consists of two loans. The details of the loans are: Loan 1: amount is $3,000,000, expected return is 10%, and standard deviation of returns is 10%. Loan 2: amount is $500,000, expected return is 12%, and standard deviation of returns is 20%. The correlation coefficient between the two loans is 0.15. Based on the Modern Portfolio Theory, compute the expected rate of return and standard deviation of this loan portfolio. (7 marks) (b) Explain the major difference between structured investment vehicle and special purpose vehicle. (15 marks)