1. There are S = 3 states and N = 3 securities with payoffs at time T > O given by the matrix (23 10 11 29 21 11 47 27 11) and time 0 prices given by p - 26, 18, 10)'. The actual probability measure is given by P = (1/3,1/3,1/3). (a) Let Ri, R, and Rs be the columns of the matrix RD of returns of D. Fill in all of the O's below. O 11/10 / (23/26 D RD = 0 D TO 27/18 (ii) E(R) = 0 (iii) o(Ri) (iv) E(R) - (v) E(R) - (vi) E(m) = 0 (vii) (m) - (viii) cov(RR ) = 0 (b) Find the equation for the mean-variance frontier. (c) Show that m/E(m) is a return that is on the mean-variance frontier. (d) Find the m-beta of R. 1. There are S = 3 states and N = 3 securities with payoffs at time T > O given by the matrix (23 10 11 29 21 11 47 27 11) and time 0 prices given by p - 26, 18, 10)'. The actual probability measure is given by P = (1/3,1/3,1/3). (a) Let Ri, R, and Rs be the columns of the matrix RD of returns of D. Fill in all of the O's below. O 11/10 / (23/26 D RD = 0 D TO 27/18 (ii) E(R) = 0 (iii) o(Ri) (iv) E(R) - (v) E(R) - (vi) E(m) = 0 (vii) (m) - (viii) cov(RR ) = 0 (b) Find the equation for the mean-variance frontier. (c) Show that m/E(m) is a return that is on the mean-variance frontier. (d) Find the m-beta of R