please help me

Short Problem II: (5 points) USE the information below for all 5 questions of this problem. ALL questions are independent. Assume that a three-factor APT describes the returns of all well- diversified portfolios, and that the three factors are unexpected changes in production (factor 1), a default spread factor (factor 2), and a Treasury term-spread factor (factor 3). Because of recent adverse events, over the next year, the market expects production to grow only by 1.5%, default spread to be 3.0%, and the term spread to be 1.8%. The pricing relationships for all well diversified portfolios are given by: E(r) =0.05 + 8, *0.07 + Biz *0.05 - B;3 * 0.04 All investors can borrow or lend at the risk free rate of 5%. Sigma(factor) = Sigma (factor2) = Sigma (factor3) = 0.15. For simplicity, assume that the coefficient of correlation between any two factors is 0. The return process for portfolio A (which is well diversified) over the next year is: FA = E(r) + 1.2fi + 0.5f2 -0.5f; . 5.a. What is the expected return portfolio A? (1 point) PLEASE REPORT YOUR expected return portfolio A ANSWER HERE 5.b. What is the standard deviation of portfolio A? (1 point) PLEASE REPORT Standard deviation of YOUR ANSWER portfolio A HERE5.c. If production grows by 3% over the next year, the default spread falls to 2.75%, and the term spread does exactly what the market expects, what will be the return on the portfolio A? (1 point) PLEASE REPORT return on the portfolio A YOUR ANSWER HERE 5.d. Assume you are using the same original factors (i.e. same economy). You are considering investing in an actively managed fund ChigaBiga. The residual standard deviation echigahiga : (e) 11%. The real return-generating process for ChigaBig is : "Chigabiga =0.08 + 2f, Chigabiga + f2, Chigabiga - 0.43, Chigabiga + Chigahiga What's the equilibrium expected return for ChigaBiga based on its risk exposure? (1 point) PLEASE REPORT YOUR expected return of ANSWER HERE ChigaBiga 5.e. According to your calculation in 5.d., you should: (1 point) A. Buy ChigaBiga because it is overpriced B. Sell ChigaBiga because it is overpriced C. Buy ChigaBiga because it is underpriced D. Sell ChigaRies aBiga because it is underpriced