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The stock of a utility company has an expected return of 10% and a standard deviation of 14%. The stock of a airline company has

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The stock of a utility company has an expected return of 10% and a standard deviation of 14%. The stock of a airline company has an expected return of 16% and a standard deviation of 20%. Compute the return and standard deviation of a portfolio consisting of 40% in the utility form and 60% in the airline company if the correlation coefficient is +.5. Explain your result. Without doing any calculations, explain what would happen to your return and standard deviation if the correlation coefficient were - 75 instead. NOTE: You must show all of your work! No credit is given for only posting an

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