Suppose that the index model for stocks A and B is estimated from excess returns with the following results:

R_A =0.03 + 0.7R_M + e_A

R_B = -0.02 + 1.2R_M + e_B

_M = 0.2

R-square_A = 0.3;

R-square_B = 0.25

Assume you create for portfolio Q with investment proportions of 0.50 in P, 0.30 in the market index, and 0.20 in T-bills, portfolio P is composed of 60% Stock A and 40% Stock B. What is the standard deviation of the portfolio Q?

Group of answer choices

0.2556

0.2766

0.4800

0.1831