Business, 19.11.2019 23:31 irene27

The standard deviation of the market-index portfolio is 30%. stock a has a beta of 1.50 and a residual standard deviation of 40%.
a. calculate the total variance for an increase of 0.10 in its beta? (do not round intermediate calculations. round your answer to 4 decimal places.)
b. calculate the total variance for an increase of 3.35% in its residual standard deviation? (do not round intermediate calculations. round your answer to 4 decimal places.
c. an investor who currently 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 following changes will have a greater impact on the portfolio's standard deviation?

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The standard deviation of the market-index portfolio is 30%. stock a has a beta of 1.50 and a residu...