Using these assets, you have isolated the three investment alternatives shown in the following table.

Alternative Investment

$1100\%$ of asset G

$240\%$ of asset F and $60\%$ of asset G

$350\%$ of asset F and $50\%$ of asset H

a$.$ Calculate the expected return over the $4-$year period for each of the three alternative

b$.$ Calculate the standard deviation of returns over the $4-$year period for each of the three alternatives.

c$.$ Use your findings in parts a and b to calculate the coefficient of variation for each of the three alternatives.

d$.$ On the basis of your findings, which of the three investment alternatives do you recommend? Why?

$4.$ Asset Z has an expected return of $9\mathrm{.}5$ percent and a beta of $0\mathrm{.}85.$ If the risk$-$free rate is $2\mathrm{.}2$ percent, complete the following table for portfolios of Asset W and a risk$-$free asset. Illustrate the relationship between portfolio expected return and portfolio beta by plotting the expected returns against the betas. What is the slope of the line that results?

$\%$ of Portfolio in Z Portfolio Expected Return Portfolio Beta

$0$

$25$

$50$

$75$

$100$

$125$

$150$

$5.$ If you added more stocks at random to the portfolio, which of the following is the most accurate statement of what would happen to $\backslash$sigma p$?$

a$.\backslash$sigma p would remain constant.

b$.\backslash$sigma p would decline to somewhere in the vicinity of $20\%.$

c$.\backslash$sigma p would decline to zero if enough stocks were included. $($use excel$)$