Trying to figure out the steps to the follow to answer the following question: The standard deviation

Question:

Trying to figure out the steps to the follow to answer the following question: The standard deviation of the market index portfolio is 20%. Stock A has a beta of 1.5 and a residual standard deviation of 30%.

a. What would make for a larger increase in the stock's variance: an increase of .15 in its beta or an increase of 3% in its residual standard deviation?

b. An investor who current holds the market index portfolio decides to reduce the portfolio allocation to the market index to 90%, and to invest 10% in stock A. Which of the changes in (a) will have a greater impact on the portfolio's standard deviation?

Portfolio
A portfolio is a grouping of financial assets such as stocks, bonds, commodities, currencies and cash equivalents, as well as their fund counterparts, including mutual, exchange-traded and closed funds. A portfolio can also consist of non-publicly...