Assume you are considering a portfolio containing two​ assets, Land M. Asset L will represent 44 % of the dollar value of the​portfolio, and asset M will account for the other 56 %. Theprojected returns over the next 6​ years, 2018-2023​, for each ofthese assets are summarized in the following​ table: a. Calculatethe projected portfolio​ return, r p​, for each of the 6 years. b.Calculate the average expected portfolio​ return, r overbarSubscript p​, over the​ 6-year period. c. Calculate the standarddeviation of expected portfolio​ returns, s Subscript p​, over the​6-year period. d. How would you characterize the correlation ofreturns of the two assets L and​ M? e. Discuss any benefits ofdiversification achieved through creation of the portfolio.
| Projected Return | |
| Year | Asset L | Asset M |
| 2018 | 13% | 21% |
| 2019 | 15% | 17% |
| 2020 | 16% | 16% |
| 2021 | 18% | 14% |
| 2022 | 17% | 13% |
| 2023 | 19% | 11% |
