1.) Calculate the expected return and standard deviation of Gryphon. Round your answers to 2 decimal places. Enter your answers below.

Recession / Probability = 0.1% / Rate of Return = -3%

Normal / Probability = 0.44% / Rate of Return = 9%

Boom / Probability = 0.46%/ Rate of Return = 11%

2.) Consider a portfolio that contains two stocks. Stock "A" has an expected return of 15% and a standard deviation of 24%. Stock "B" has an expected return of 4% and a standard deviation of 7%. The proportion of your wealth invested in stock "A" is 65%. The correlation between the two stocks is -0.8. What is the expected return of the portfolio? Enter your response below rounded to 2 DECIMAL PLACES. What is the standard deviation of the portfolio? Enter your response below rounded to 2 DECIMAL PLACES.

3.) The portfolio weights for stocks "A" and "B" are 0.15 and 0.85, respectively.What are the expected returns of stock "A" and "B"? Enter your answers as a percentage. Round your answers to 2 DECIMAL PLACES.

Recession / Probabilities P₁ = 33% / Stock A = -4% / Stock B = 5%

Normal / Probabilities P₂ = 0.29% / Stock A = 3% / Stock B = -11%

Boom / Probabilities P₃ = 0.38%/ Stock A = 15% / Stock B = 22%

Using the answers from the previous question, what are the standard deviations of Stock A & B?

4.) During the past 10 years, the percent returns on two mutual funds (aggressive and passive) expressed in percentages were as follows:

Year Aggressive Fund Passive Fund

-10 0% 3%

-9 7% 4%

-8 0% 3%

-7 3% 2%

-6 6% 4%

-5 0% 2%

-4 10% 4%

-3 2% 3%

-2 2% 2%

-1 3% 4%

a) Compute the expected return for the two funds.Round your answers to two decimal places.

b) Compute the variance and standard deviation of the returns of the two funds.Round your answers to two decimal places.

5.) Calculate the expected return and standard deviation of Gryphon. Round your answers to 2 decimal places.

Recession / Probability = 0.15 / Rate of Return = 2%

Normal / Probability = 0.49 / Rate of Return = 11%

Boom / Probability = 0.36 / Rate of Return = 14%