Q$1.$ a$)$ Consider stock D and E with the following estimates:

Expected returnStandard deviationStock D$8\%12\%$Stock E$13\%20\%$

$$Now consider the portfolios that can be formed with D and E assuming that the investment is equal between D and E $($that is$,$ each has equal weights$).$ Calculate the portfolio$$s standard deviation if the correlation between D and E $($Corr DE$)$ is:

i$)$ Corr DE$=1\mathrm{.}0$ ii$)$ Corr DE$=0\mathrm{.}3$

ii$)$ Corr DE$=0\mathrm{.}0$ iv$)$ Corr DE$=-1\mathrm{.}0$

b$)$ Using the results obtained in part $($a$)$ above, how does the correlation between stock D and E affect the standard deviation of a portfolio.