1. Based on End-of-Chapter Problem 6 in Chapter 5 The stock of Business Adventures sells for $40 a share. Its likely dividend payout and end-of-year price depend on the state of the economy by the end of the year as follows: a. Calculate the expected bolding-period retum and standard deviation of the holding-period return. All three scenarios are equally likely. b. Calculate the expected return and standard deviation of a portfolio invested half in Business Adventures and half in Treasury bills. The return on bills is 4%. 2. Based on End-of-Chapter Problem 12 in Chapter 5 Suppose that you manage a risky portfolio with an expected rate of retum of 17% and a standard deviation of 27%. The T.bill rate is 7%. Your client chooses to inveat 70% of a portfolio in your fund and 30% in a T-bill money market fund. a. What is the expected return and standard deviation of your client's portfolio? b. Suppose your risky portfolio inclades the following investments in the given proportions: Stock A 27% Stock B 33% Stock C 40% What are the investment proportions of your client's overall portfolio, including the position in T-bills? c. What is the Sbarpe ratio (Sp) of your risky ponfolio and your client's overall portfolio? 1. Draw the CAL of your portfolio on an expected return/standard deviation diagram. What is the slope of the CAL? Sbow the position of your client on your fund s CAL