1. If GE has an annual risk of 27.4 percent, what is the volatility of monthly GE returns?
2. Stock A has 25 percent risk, stock B has 50 percent risk, and their returns are 50 percent correlated. What fully invested portfolio of A and B has minimum total risk? (Hint: Try solving this graphically (e.g. in Excel), if you cannot determine the answer mathematically.)