Problem 1. 2 risky and 1 riskless asset. 33 points Suppose you are considering forming a portfolio on 2 risky assets and 1 risk free asset. The risky assets are Amazon and Ford. You know that: For Amazon, the expected return is 0.035978 and the standard deviation is 0.084561. For Ford, the expected return is 0.027433 and the standard deviation is 0. 150784. The correlation coefficient between Amazon and Ford is 0.077217. The risk free rate is 1.57%. a. Please report the expected return and standard deviation to a portfolio that invests 35% into Amazon and 65% into Ford. Make sure to indicate what formulas to use and to show your work. b. Build and graph a portfolio opportunity set like we did in class. You can use 10% increments in the weights. Also graph the capital allocation line. c. Please report the investment proportions in the minimum variance portfolio of the two risky assets. d. Report the minimum variance portfolios expected return and standard deviation. e. Find the optimal risky portfolio weights. f. Report the expected return, variance, standard deviation and sharpe ratio of the optimal risky portfolio. g. Suppose the clientele has a utility function akin to the one used in the midterm, with a risk aversion coefficient A = 4. Report the optimal weights to the risk free asset vs the risky portfolio. h. Suppose your client has $1,000,000 to invest in this setup. Report the % terms and dollar amounts of how much they invest into the risk free asset, Amazon and Ford. i. Comment on the correlation between Amazon and Ford. Do you think this portfolio is well diversified? Why or why not? In a few bullet points or sentences, suggest and explain a strategy to improve my proposed portfolio.Problem 2. 3 risky assets. 33 points a. Through WRDS / Compustat, access the monthly holding period returns from 2010:01 to 2021:12 for Apple, AMD and JP Morgan. (Tickers: AAPL, AMD, JPM). b. Find and report the optimal portfolio weights formed on these 3 risky assets. To do this, you will need: the expected returns and standard deviations, along with all the correlation (or covariance) pairs. c. Report the mean and standard deviation of the optimal portfolio. Problem 3. Bonds. 36 points a. Explain whether or not today an investor can determine what the cash flows of a floating-rate bond will be. b. A pension fund manager invests $1 million in a debt obligation that promises to pay 7.3$ per year for 4 years. What is the future value of the $1 million? c. Price a bond which compounds quarterly, with a maturity of 20 years, a coupon rate of 3%, and a face value of $100. Assume the yield is 4%. d. What would happen to the price of this bond if yields increased