Suppose General Motors stock has an expected return of 19% and a volatility of 41%, andMolson-Coors Brewing has an expected return of 14% and a volatility of 30%. If the two stocks areuncorrelated,

a. What is the expected return and volatility of a portfolio consisting of 70% General Motors stock and 30% ofMolson-Coors Brewingstock?

b. Given your answer to (a), is investing all of your money inMolson-Coors stock an efficient portfolio of these twostocks?

c. Is investing all of your money in General Motors an efficient portfolio of these twostocks?

a. What is the expected return and volatility of a portfolio of 70% Ford Motor stock and 30% ofMolson-Coors Brewingstock?

The expected return of the portfolio is

nothing

%. (Round to two decimalplaces.)

The volatility of the portfolio is

nothing

%. (Round to two decimalplaces.)

b. Given your answer to (a), is investing all of your money inMolson-Coors stock an efficient portfolio of these twostocks?(Select the best choicebelow.)

A.

Cannot determine from the given information.

B.

Yes.

C.

No.

c. Is investing all of your money in General Motors an efficient portfolio of these twostocks? (Select the best choicebelow.)

A.

Yes.

B.

No.

C.

Cannot determine from the given information.