You are considering investing in two stocks. There are two possible states for the economy

over the next year: $$Good$$ and $$Bad$.$ Each state is equally likely $($that is$,$ probability for

each state is $50\%).$ Their return in each possible state is estimated as follows:

State Return to stock A Return to stock B

Good $30\%5\%$

Bad $10\%10\%$

$($a$)$ What are the expected return and volatility of each stock return?

$($b$)$ What are the covariance and correlation between the two stock returns?

$($c$)$ Construct the minimum varianc