Suppose Johnson & Johnson and Walgreen Boots Alliance have expected returns and volatilities shown here, see the table below ,with a correlation of 22%.

Calculate (a) the expected return and

(b)the volatility (standard deviation) of a portfolio that consists of a long position of $8,000 in Johnson & Johnson and a short position of $2,000

in Walgreens.

a. Calculate the expected return.

The expected return is............%.(Round to one decimalplace.)

b. Calculate the volatility (standard deviation).

The volatility is..............%. (Round to one decimalplace.)

	Expected Return		Standard Deviation
Johnson & Johnson	6.9%		17.6%
Walgreens Boots Alliance	10.7%		19.6%