How to answer these questions using excel?

Consider the following statistics for assets X and Y:

Expected Return and Standard Deviation

X Y

Expected Return 14.30% 12.40%

Standard Deviation 32.05% 17.20%

Correlation

X Y

Y 1

X 0.637 1

Suppose that you have three portfolios, made up of the above risky assets, with the following portfolio weights:

Portfolio A = 0.5 0.5

Portfolio B = 0.1 0.9

Portfolio C = -0.5 1.5

Note that short selling is allowed in this market and that the risk-free rate is 7.50% per annum.

(a) Calculate the minimum variance portfolio composed of the three portfolios A, B and C. Explain your answer.

(b) Based on target expected returns ranging from 10% to 15% at intervals of 0.5% points, calculate the standard deviation of the portfolio composed of A, B and C. Explain your answer.

(c) Plot a graph of the returns and standard deviations of convex combinations of the 3 portfolios.

(d) Calculate the weights in which the three portfolios appear in the optimal risky portfolio (M). Explain this concept of M.

(e) Plot the Capital Market Line. What are the risk and return of the optimal risky portfolio and how do these compare with the corresponding risk and returns of portfolios A, B and C? Which of these 3 portfolios would you choose and why?