Given:

	E(R1) = 0.12
	E(R2) = 0.17
	E(1) = 0.04
	E(2) = 0.05

Calculate the expected returns and expected standard deviations of a two-stock portfolio having a correlation coefficient of 0.60 under the conditions given below. Do not round intermediate calculations. Round your answers to four decimal places.

1. w₁ = 1.00

   Expected return of a two-stock portfolio:

   Expected standard deviation of a two-stock portfolio:

2. w₁ = 0.75

   Expected return of a two-stock portfolio:

   Expected standard deviation of a two-stock portfolio:

3. w₁ = 0.55

   Expected return of a two-stock portfolio:

   Expected standard deviation of a two-stock portfolio:

4. w₁ = 0.30

   Expected return of a two-stock portfolio:

   Expected standard deviation of a two-stock portfolio:

5. w₁ = 0.05

   Expected return of a two-stock portfolio:

   Expected standard deviation of a two-stock portfolio:

Choose the correct riskreturn graph for weights from parts (a) through (e) when r_i,j = -0.60; 0.00; 0.60.