A U.S. investor is considering a portfolio consisting of 60% invested in the U.S. equity index fund and 40% invested in the British equity index fund. The expected returns for the funds are 10% for the U.S. and 8% for the British, standard deviations of 20% for the U.S. and 18% for the British, and a correlation coefficient of 0.30 between the U.S. and British equity funds.

a) What is the expected return of the proposed portfolio?

b) What is standard deviation of the proposed portfolio?