please include formulas

126% T View Zoom Add Category Chart Insert Table Text Shape Media 7-6 10 11 PROBLEM 7-6 12 13 Effect on Risk of Adding a New Asset to a Portfolio 14 15 Given 16 Expected Return of existing portlolo A Standard deviation of existing portfollo A 17 9.00% 3.00% 18 19 20 Expected Retum of new asset B Standard deviation of new asset B 12.00% 400% 21 22 23 Amount invested in Portfolio A Amount to be invested in Asset B $700,000 $200,000 24 25 26 Corelation coeficient r bebween 27 existing portfolio A and new asset 8 0 28 29 Preliminary calculations: 30 31 32 33 34 35 Coefficient of variation of existing porfolio A Coefficient of variation of new asset B Total value of new combined portfolio 36 Weight of existing assets in combined portfolio Weight of new asset B in combined portfolio 37 38 39 Expected Return of combined portfolio per equation 7-1 40 41 42 Comparison. of standard deviations of existing and new combined portfolios 43 44 Standard deviation of new combined portfolio per equabion 7-5 Standard deviation of existing portfolio A (given) 45 46 3.00% 47 48 Comparison.of coafficients of variatign of existing and new combined portfolios 49 50 Coefficient of Variation of new combined portfolio Coefficient of Variation of existing portfolio A 52 0.00% PROBLEM 7-6 Text MacBook Air esc FI F2 F3 EA