1. An investor invests $2.5mi in stock A and $5mi in stock B. State of Economy Probability Return Return (A) 20% (B) 5% Boom .25 Normal .50 10% 10% Bust .25 0% 15% a.) Calculate the expected return and variance for each stock. b.) Calculate the covariance and correlation between the 2 stock returns. c.) Calculate the portfolio's return and variance