The Neilson family has a $$800,000$ fully diversified portfolio which is managed by RPL Investments. The

family fund has inherited common stock of Williams Cos. worth $$200,000.$ RPL$\text{'}$s advisor provided the

Neilson family with the following estimates, including the correlation coefficient of $0\mathrm{.}40.$

The inheritance changes the family's overall portfolio and the family is deciding whether to keep the

newly acquired stock. If the family keeps the stock, the expected return of the new portfolio, which

includes the Williams stock will be

$\%.$ The covariance of Williams' stock

returns with the original portfolio will b $lon$

The standard deviation of the

new portfolio which includes Williams stock will be

$\%.$

If the Neilson family sells the Williams stock, the adviser suggested investing the proceeds in

government securities yielding $5\%$ annually. Assuming the family agrees to this suggestion, the

expected return of the new portfolio which includes the government securities will be

$\%.$

The covariance of the government security returns with the original portfolio returns will be