The standard deviation of the market-index portfolio is 35%. Stock A has a beta of 1.40 and a residual standard deviation of 45%. a-1. Calculate the total variance of stock A if its beta is increased by 0.20?
a-2. Calculate the total variance of stock A if its residual standard deviation is increased by 7.54%?
b. An investor who currently holds the market-index portfolio decides to reduce the portfolio allocation to the market index to 90% and to invest 10% in stock A. Which of the following changes (an increase of 0.20 in beta or increase of 7.54% in residual standard deviation) will have a greater impact on the portfolio's standard deviation?
i. Both will have the same impact.
ii. Increase of .20 in beta will have a greater impact.
iii. Increase of 7.54% in the residual standard deviation will have a greater impact.

In return for their with optimizing his painting project, the castle servant informed poly and digit that he saw someone dressed as the king leaving behind a trail of crumbs as he walked into the jester's room late last night. poly and digit have finally found the crisp-collecting culprit — it turns out the jester's shoe size and hair color match the clues that were found! in gratitude, poly and digit agree to the servant with his current task of replacing all of the tables and chairs in the castle. his goal is to determine which furniture company should produce the new furniture. he receives information from a company that customizes elegant furniture, and he wants to analyze the company's production process in order to calculate some problems about cost and availability. read the following scenario, and assist poly and digit as they the servant with his calculations. the fit for a king furniture company requires 2020 hours of labor to produce a standard table, and a chair requires 1212 hours of labor. the labor available is 565565 hours per week. the company can produce at most 3535 chairs per week.