3 When we introduced mean returns and standard deviations earlier in this chapter, we showed the annual returns and risks for Asset A and Asset B. This information is reproduced below:

a Calculate the mean return and standard deviation of the portfolio containing 50% invested in Asset A and 50% in Asset B.
b Calculate the mean return and standard deviation of the portfolio containing 75% invested in Asset A and 25% in Asset B.
c In a table, summarise the mean return and standard deviations for Assets A and B and the two portfolio combinations calculated above. Compare and contrast the risk and return of each.
d How is it possible that the returns for the two portfolio combinations are both greater than Asset A but have lower risk than Asset A?