You are considering making additional investments, and have gathered data about two risky stocks:

Stock	Expected Return	Beta	Firm-Specific Standard Deviation
CVX	11.5 %	1.10	24%
Forsythe Inc.	16 %	.75	28%

a. Calculate the standard deviation (i.e. the total risk) of CVX. (2 points)

b. Calculate the standard deviation (i.e. the total risk) of Forsythe. (2 points)

c. Calculate the covariance between the two stocks. (4 points)

d. Calculate the correlation between the two stocks. (4 points)

e. How does the single-index model improve on the traditional Markowitz approach to creating portfolios? (3 points)