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18 Jan 2019

Consider the following information:
Rate of Return If State Occurs
State of Probability of
Economy State of Economy Stock A Stock B Stock C
Boom .15 .350 .450 .330
Good .45 .120 .100 .170
Poor .35 .010 .020 −.050
Bust .05 −.110 −.250 −.090
Requirement 1:

Your portfolio is invested 30 percent each in A and C and 40 percent in B. What is the expected return of the portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Expected return of the portfolio %
Requirement 2:
(a)

What is the variance of this portfolio? (Do not round intermediate calculations. Round your answer to 5 decimal places (e.g., 32.16161).)

Variance of the portfolio
(b)

What is the standard deviation of this portfolio? (Do not round intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).)

Standard deviation %

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Jean Keeling
Jean KeelingLv2
20 Jan 2019

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