Use the information provided in the table below to answer the following questions Security A Security B E(R) 12 13 Standard Deviation 0 021 0 029 Beta 1 1 1 2 Variance of the market 0 0002 Correlation Coefficient (A, B) 0 6 1 what is the covariance between security A and the market 2 if the risk free rate is 8 , what is the expected return and variance of a portfolio containing 50 of the risk free rate and 50 of the security B

Question: Use the information provided in the table below to answer the following questions: Security A Security B E(R) 12% 13% Standard Deviation 0.021 0.029 Beta

Use the information provided in the table below to answer the following questions:

	Security A	Security B
E(R)	12%	13%
Standard Deviation	0.021	0.029
Beta	1.1	1.2
Variance of the market	0.0002
Correlation Coefficient (A, B)	0.6

1. what is the covariance between security A and the market?

2. if the risk free rate is 8%, what is the expected return and variance of a portfolio containing 50% of the risk-free rate and 50% of the security B?

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