Stocks A and B have the following returns:(Click on the following icon

in order to copy its contents into a spreadsheet.)

	Stock A	Stock B
1	0.09	0.07
2	0.04	0.01
3	0.14	0.04
4	0.05	0.01
5	0.08	0.03

a. What are the expected returns of the two stocks?

b. What are the standard deviations of the returns of the two stocks?

c. If their correlation is

0.45,

what is the expected return and standard deviation of a portfolio of

54%

stock A and

46%

stock B?

Question content area bottom

Part 1

a. What are the expected returns of the two stocks?

The expected return for stock A is

enter your response here.

(Round to three decimal places.)

Part 2

The expected return for stock B is

enter your response here.

(Round to three decimal places.)

Part 3

b. What are the standard deviations of the returns of the two stocks?

The standard deviation of the return for stock A is

enter your response here.

(Round to four decimal places.)

Part 4

The standard deviation of the return for stock B is

enter your response here.

(Round to four decimal places.)

Part 5

c. If their correlation is

0.45,

what is the expected return and standard deviation of a portfolio of

54%

stock A and

46%

stock B?

The expected return for the portfolio is

enter your response here.

(Round to four decimal places.)

Part 6

The standard deviation of the return for the portfolio is

enter your response here.

(Round to four decimal places.)