Question: RA = 4.00% + 0.50RM + eA RB = -1.20% + 0.70RM + eB M = 17%; R-squareA = 0.26; R-squareB = 0.18 Assume you

RA = 4.00% + 0.50RM + eA RB = -1.20% + 0.70RM + eB M = 17%; R-squareA = 0.26; R-squareB = 0.18

Assume you create portfolio P with investment proportions of 0.70 in A and 0.30 in B.

SD of portfolio?

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