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The following information about a two stock A and B. Portfolio Stock A Stock B Amount 20,000 30,000 Expected Return 12% 20% Standard Deviation 20%

The following information about a two stock A and B.

Portfolio

Stock A

Stock B

Amount

20,000

30,000

Expected Return

12%

20%

Standard Deviation

20%

30%

Correlation

0.25

1. Calculate the weight (W) for each stock. 2. What is the portfolio expected return? 3. Calculate the variance and standard deviation of the portfolio.

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