Suppose Ford Motor stock has an expected return of

18 %18%

and a volatility of

42 %42%,

and Molson Coors Brewing has an expected return of

11 %11%

and a volatility of

31 %31%.

If the two stocks are uncorrelated,a. What is the expected return and volatility of a portfolio consisting of

71 %71%

Ford Motor stock and

29 %29%

of Molson Coors Brewing stock?b. Given your answer to

(a),

is investing all of your money in Molson Coors stock an efficient portfolio of these two stocks?

c. Is investing all of your money in Ford Motor an efficient portfolio of these two stocks?