Computing the standard deviation for a portfolio of two risky? investments) Mary Guillot recently graduated from...

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Computing the standard deviation for a portfolio of two risky?investments) Mary Guillot recently graduated from Nichols StateUniversity and is anxious to begin investing her meager savings asa way of applying what she has learned in business school.?Specifically, she is evaluating an investment in a portfoliocomprised of two? firms' common stock. She has collected thefollowing information about the common stock of Firm A and Firm?B:
Expected??????????
Return????????????
Standard Deviation
Firm? A's common stock
0.170.17
0.190.19
Firm? B's common stock
0.180.18
0.240.24
Correlation coefficient
0.400.40
a. If Mary invests half her money in each of the two common?stocks, what are the? portfolio's expected rate of return andstandard deviation in portfolio? return?
b. Answer part a where the correlation between the two commonstock investments is equal to zero.
c. Answer part a where the correlation between the two commonstock investments is equal to plus1.
d. Answer part a where the correlation between the two commonstock investments is equal to minus1.
e. Using your responses to questions along dashed?, describe therelationship between the correlation and the risk and return of theportfolio.

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Computing the standard deviation for a portfolio of two risky?investments) Mary Guillot recently graduated from Nichols StateUniversity and is anxious to begin investing her meager savings asa way of applying what she has learned in business school.?Specifically, she is evaluating an investment in a portfoliocomprised of two? firms' common stock. She has collected thefollowing information about the common stock of Firm A and Firm?B:Expected??????????Return????????????Standard DeviationFirm? A's common stock0.170.170.190.19Firm? B's common stock0.180.180.240.24Correlation coefficient0.400.40a. If Mary invests half her money in each of the two common?stocks, what are the? portfolio's expected rate of return andstandard deviation in portfolio? return?b. Answer part a where the correlation between the two commonstock investments is equal to zero.c. Answer part a where the correlation between the two commonstock investments is equal to plus1.d. Answer part a where the correlation between the two commonstock investments is equal to minus1.e. Using your responses to questions along dashed?, describe therelationship between the correlation and the risk and return of theportfolio.

Expected?????????? Return????????????		Standard Deviation
Firm? A's common stock	0.170.17	0.190.19
Firm? B's common stock	0.180.18	0.240.24
Correlation coefficient	0.400.40