1. Stock A has a beta of 1.2 and a standard deviation of 20percent. Stock B has

1. Stock A has a beta of 1.2 and a standard deviation of 20percent. Stock B has a beta of 0.8 and a standard deviation of 25percent. Portfolio P is a $200000 portfolio consisting of $100000invested in Stock A and $100000 invested in Stock B. Which of thefollowing statements is most correct? (Assume that the requiredreturn is determined by the Security Market Line.)