The following table,

Year ABC Returns B Returns

2005 5.2% 16.9%

2006 2.1% 8.8%

2007 32.9% 26.6%

2008 11.7% 4.4%

2009 30.5% 10.9%

2010 25.8% 10.4%

2011 23.6% 3.4%

2012 52.6% 43.3%

2013 37.6% 41.5%

2014 31.7% 40.8%

2015 27.1% 12.7%

2016 3.9% 0.3%

2017 43.8% 27.6%

, contains annual returns for the stocks of

ABC Corp. (ABC) and Company B (B). The returns are calculated using end-of-year prices (adjusted for dividends and stock splits). Use the information for

ABC Corp. (ABC) and Company B (B) to create an Excel spreadsheet that calculates the average returns over the 10-year period for portfolios comprised of ABC and B using the following, respective, weightings: (1.0, 0.0), (0.9, 0.1), (0.8, 0.2), (0.7, 0.3), (0.6, 0.4), (0.5, 0.5), (0.4, 0.6), (0.3, 0.7), (0.2, 0.8), (0.1, 0.9), and (0.0, 1.0). The average annual returns over the 10-year period for ABC and B are 17.61% and 12.88% respectively. Also, calculate the portfolio standard deviation over the 10-year period associated with each portfolio composition. The standard deviation over the 10-year period for ABC Corp. and Company B and their correlation coefficient are 24.54%, 21.13%, and 0.83553 respectively. (Hint: Review Table 5.2.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
1.0	0.0	nothing ___%		nothing ____%

Enter the average return and standard deviation for a portfolio with 90%

ABC Corp. and 10%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.9	0.1	nothing ____%		nothing ____%

Enter the average return and standard deviation for a portfolio with 80%

ABC Corp. and 20%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.8	0.2	nothing ____%		nothing ____%

Enter the average return and standard deviation for a portfolio with 70%

ABC Corp. and 30%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.7	0.3	nothing ___%		nothing ____%

Enter the average return and standard deviation for a portfolio with 60%

ABC Corp. and 40%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.6	0.4	nothing ____%		nothing _____%

Enter the average return and standard deviation for a portfolio with 50%

ABC Corp. and 50%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.5	0.5	nothing _____%		nothing _____%

Enter the average return and standard deviation for a portfolio with 40%

ABC Corp. and 60%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.4	0.6	nothing _____%		nothing ____%

Enter the average return and standard deviation for a portfolio with 30%

ABC Corp. and 70%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.3	0.7	nothing _____%		nothing _____%

Enter the average return and standard deviation for a portfolio with 20%

ABC Corp. and 80%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.2	0.8	nothing _____%		nothing _____%

Enter the average return and standard deviation for a portfolio with 10%

ABC Corp. and 90%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.1	0.9	nothing _____%		nothing ______%

Enter the average return and standard deviation for a portfolio with 0%

ABC Corp. and 100%

Company B in the table below.(Round to two decimal places.)

Portfolio Weights		Portfolio Average Return		Portfolio Standard Deviation
wABC	wB	rABC=17.61%	rB=12.88%
0.0	1.0	nothing ____%		nothing _____%